On Fri, 12 Oct 2007 17:55:51 -0500, Mark Freeland wrote:

- quote -

Mark, thanks for explaining this so lucidly. I hadn't known about no bonus
for spouse waiting beyond full retirement age.

Pete

CIL wrote:
- quote -

We knew the Windfall Elimination Act would reduce his SS by about 50%,
but we can collect all of mine as long as I live...correct?
We were not aware that he would not be able to collect my SS when I
die...is this really true!!! :-(


======================================= MODERATOR'S COMMENT:
Please trim the post to which you are responding. "Trim" means that except for a FEW lines to add context, the previous post is deleted.

"Pete" <spam[at]nowhere.com> wrote in message news:1jeyiwxjltmcx$.1xpcdhjrc9di6$.dlg[at]40tude.net...
- quote -

It implies she'll get bumped up, but as you point out, only to 1/2 of the amount her husband would have gotten had he retired at age 62. And even if she waits, there's no point in deferring the start past full retirement age, because a person receiving 1/2 of spouse's benefits never gets more than 1/2 the spouse's full amount. No bonus for the spouse deferring past full retirement age. http://www.ssa.gov/pubs/10035.html#family

I think the AARP observation is almost, but not quite, correct. Change 62 to "full retirement age", and it will be correct.

For a spouse with a small benefit, taking benefits at full retirement age, instead of waiting until 70 can make sense, even if the other rules of thumb say otherwise. For the sake of argument, let's assume both spouses are the same age, and the larger wage earner is deferring benefits to age 70 (this is where being in good health comes in; at least one spouse would be expected to live past age 82 or so, and thus gain by deferring benefits until age 70).

The other spouse (typically wife) should start drawing at age 66 (i.e. full retirement age). For four years, until age 70, that spouse will draw benefits on her own earnings. At age 70, the husband starts drawing, and the wife draws half the full retirement amount.

Had the wife waited until age 70, she would have gotten nothing for four years, and then at age 70, started with the same amount - half her husband's full retirement benefits. There's no increase in what she would get because he started later. The most she can get is half of his full benefit. So four years of benefits would be lost.

The numbers don't work out as neatly if she starts drawing at age 62, which is why I'm not convinced the AARP article is entirely correct.

Mark Freeland
BnetOnewsX[at]sbcglobal.net

Very astute ! ! ! I was referring to those bureaucrats at S.S.
Cal




"Elizabeth Richardson" <erichktn[at]worldnet.att.net> wrote in message
news:yCOPi.208609$ax1.205566[at]bgtnsc05-news.ops.worldnet.att.net...

"Cal" <cal-lester[at]comcast.net> wrote in message
news:vsKdnab06rzxwpPanZ2dnUVZ_jqdnZ2d[at]comcast.com...
I can only relate my personal position. When I approached age 62, I did
the research, and crunched the members.

I missed this the first time. Which members were you crunching? Those
working for social security?

Elizabeth Richardson

I was self employed, and controlled my reportable income.
At no time was I in danger of losing any of it due to too much income.
Cal



"Elizabeth Richardson" <erichktn[at]worldnet.att.net> wrote in message
news:WAOPi.669974$p47.584010[at]bgtnsc04-news.ops.worldnet.att.net...

"Cal" <cal-lester[at]comcast.net> wrote in message
news:vsKdnab06rzxwpPanZ2dnUVZ_jqdnZ2d[at]comcast.com...
I can only relate my personal position. When I approached age 62, I did
the research, and crunched the members.
I found that in my personal circumstance that I would have to live beyond
the age of 79 before any difference in the amount received would be
apparent. ( I am currently 78).


Yes, but Cal, weren't you still working? There is surely no point to taking
the benefit before full retirement age if one is still working. It seems to
me that the question of when to start taking benefits should be analyzed
only after one stops working or, at the very least, after one reaches full
retirement age.

Elizabeth Richardson

"Cal" <cal-lester[at]comcast.net> wrote in message news:vsKdnab06rzxwpPanZ2dnUVZ_jqdnZ2d[at]comcast.com...
I can only relate my personal position. When I approached age 62, I did the research, and crunched the members.

I missed this the first time. Which members were you crunching? Those working for social security?

Elizabeth Richardson

"Cal" <cal-lester[at]comcast.net> wrote in message news:vsKdnab06rzxwpPanZ2dnUVZ_jqdnZ2d[at]comcast.com...
I can only relate my personal position. When I approached age 62, I did the research, and crunched the members.
I found that in my personal circumstance that I would have to live beyond the age of 79 before any difference in the amount received would be apparent. ( I am currently 78).


Yes, but Cal, weren't you still working? There is surely no point to taking the benefit before full retirement age if one is still working. It seems to me that the question of when to start taking benefits should be analyzed only after one stops working or, at the very least, after one reaches full retirement age.

Elizabeth Richardson

On Thu, 11 Oct 2007 12:38:17 -0500, "Cal" <cal-lester[at]comcast.net> wrote:

- quote -

I did similar calculations and began taking SS early. In the same AARP
Bulletin, there is another article on when to start taking SS
(http://tinyurl.com/23plbj). One of the comments made by that author as a
reason to start early is: "You don't need the money. You are comfortable
financially, so you plan to invest your benefits."

In my case, it allowed me to "not withdraw" funds from my Roth IRA. So for
the last three years, during which I've gone from age 62-65, I've averaged
16.2% per year in that account.
--ron

Mr. Moderator,

Do you think anyone like to comment or provide information/guidance to the
following post, if this is not something the group may not want to read
please do not post.

thanks

Here is our situation - Any advice will be welcomed.

I am retired DoD Civilian (35.5 years of Service), Civil Service Retirement
System (CSRS), and have paid 36 Quarters of Social Security Prior to the
Government Civilian job ¡V current age 58.

My wife worked for a large Grocery Chain and recently started drawing her SS
at 62.

My concerns are:
Catch 62 - If a veteran is a US Government employee and retires his/her CSRS
retirement will be reduced by 2% per year of Military
Service if they do not pay in 7% of the monies they made while on Active
duty to the CSRS. This happens when and if they become
eligible to draw Social Security (age 62). Notice there is no Option ¡§When
they become eligible¡¨. This was signed by President Reagan around 1986.
I had 3.5 years of Military duty and had to ante up $1150 for the time
served. Believe me I did not have that much fun, travel and adventure.

Windfall Elimination Act - When I elect to start drawing my Social Security
after age 62 I will not be able to draw the full amount, I am
not sure what it will be but friends of ours are getting about 50% of their
benefit check. If I die before my wife she will have an option to
draw 55% of my CSRS pension or my Social Security. If she dies before me I
get nothing. I will not be able to collect any of her Social
Security and only a partial amount of mine.

I have gone back to work to get my additional Social Security Quarters paid
and to add some $$ to the savings.

The CSRS has/had some good benefits, so I cannot complain too much but this
seems terribly unfair especially the spousal benefits that we cannot
receive.

Thanks

On Thu, 11 Oct 2007 12:38:17 -0500, "Cal" <cal-lester[at]comcast.netwrote:

- quote -

they don't tell you about that there is no way you can tell if it's a
good recommendation.

First of all, just how old are the husband and wife? Are they 3-5
years apart or 17 like my wife and I?

Do they need the money to live on or is this money that can be
invested elsewhere?

How much of a difference in full benefits between the husband and
wife?
Thumper
- quote -

I can only relate my personal position. When I approached age 62, I did the research, and crunched the members.
I found that in my personal circumstance that I would have to live beyond the age of 79 before any difference in the amount received would be apparent. ( I am currently 78).

I also calculated that IF I had placed the monies received from S.S. into a CONSERVATIVE safe investment (5%), from age 62 to 65, and not used it for living expenses UNTIL I reached age 65, that I would have had to live PAST age104 before I realized a difference in income.

Cal



That is that the funds received from 62 to 65, OFFSET the loss of the added benefit that I could have received at 65.
"Pete" <spam[at]nowhere.com> wrote in message news:1jeyiwxjltmcx$.1xpcdhjrc9di6$.dlg[at]40tude.net...
- quote -

The Oct 2007 issue of AARP Bulletin (page 22) says:

================================================== ========================
1. If you can delay taking your benefit, you should. For each year you wait
after your full retirement age, your starting check rises by 8 percent¡Xa
splendid, guaranteed "return." If you die, you'll also leave a larger
benefit for your spouse. After age 70, the initial benefit stops going up.

2. There's an exception for married people in good health when one of them
has a small Social Security benefit. Typically, that's the wife. If she
retires first, she should start her individual benefit at 62. When her
husband retires, she'll switch to the spousal benefit. By using her own
account first, she taps a benefit that otherwise would have gone to waste.

[Full article at: http://tinyurl.com/3cyv6s]
================================================== ========================

Paragraph #2 implies that when the wife switches to the spousal benefit,
she will get the bumped up amount due to the husband's deferral to age 70.
Great deal if you can get it, but it seems to me this is not true. The SSA
web site says:

================================================== ========================
Q: Can my spouse collect benefits at age 62 from her work and earnings and
then receive a combined total up to 50 per cent from my account when I
start receiving benefits at age 65?

A: Your wife can start receiving reduced retirement benefits on her own
record at age 62. If the amount she receives on her own record is less than
what she would be entitled to as a spouse, she would receive a higher
spouse's benefit when you start receiving benefits. However, because she
began receiving Social Security before reaching full retirement age, she
will receive a reduced benefit rate that is less than the full 50 percent
amount for as long as she remains entitled to spouse's benefits.

[Full article at: http://tinyurl.com/2mlu8u]
================================================== ========================

It seems that, if you do as AARP suggests, 8 years of a small "extra"
income from the wife's account is offset by a 43% reduction in a higher
spousal benefit starting at husband's age 70. You'd have to crank the
numbers to be sure, but this strategy would surely lose money in most
cases.

Am I right that AARP's advice is bad, or have I missed the point somewhere?
And why is the strategy recommended for "married people in good health"?

Pete