Catherine White wrote:
- quote -

Age 72 sounds way too young to reach the break-even point.
Using the 1943-1954 baby boomers: retiring at age 62 is a
full 4 years earlier than FRA. The hit to benefits for 48
months early is a 25% loss of benefits. This means you
collect 75% of FRA benefits for 4 years before you would
collect benefits if you waited for FRA. A quick calculation
assuming no interest is 12 years. Using $1000 as the FRA
benefit: $750 x 48 months = $36000. $36000 / $250
differential = 144 months to break even. Add interest and
the years to break even go up as the interest rate goes up.

Naturally, one would also have to consider one's tax rate,
whether one's SSA benefits were taxable and whether one
continued to work after retiring early and had earned income
in excess of the SSA limit.

--
Alan
http://taxtopics.net

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Catherine White wrote:
- quote -

Furthermore, the near term years you come out ahead if there
is no other income. The crossover point is about 10 years
out, depending on inflation & taxes.

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Catherine White <cgrantNoSpam[at]alum.mit.edu> wrote:

- quote -

IMO the best answer to this depends on what the recipients
does with the money starting at 62. For example, do they
spend it or save it? If they spend it, what they spend it on
makes a difference - do they spend it on consumption and
cars that depreciate, or are they paying down debt, buying a
house, etc.? And if they invest it, what is a reasonable
return for that person given their investment skills between
age 62 and FRA.

The best answer also depends on how long the recipient lives
and whether SS changes while we wait for our FRA to arrive.

I find it easy to argue either position (take it or defer)
simply by varying the assumptions.

- quote -

Couldn't agree more.

-HW "Skip" Weldon
Columbia, SC

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glendale202-taxes[at]yahoo.com (A.G. Kalman) wrote in news:11imm0dhtgae779

- quote -

A small note on collecting Social Security Benefits at 62
rather than FRA; the general rule of thumb I've heard and
gone by is that if you live past 72, it's a net loss in
lifetime income. But the difference between 65 and FRA is
so minimal that it's usually not worth waiting for.

However, that's all irrelevant if you need the money _now_.

Catherine

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HW "Skip" Weldon wrote:
- quote -

Fine clarification! Wish I'd had that to read BEFORE
reading the Social Security bulletin on the subject. (And I
did find an error in their calculations!)

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- quote -

The full spouse's benefit is 50%. However, one can only get
the full 50% if one waits until FRA. As this spouse is not
waiting until FRA but will start collecting at age 62, the
benefit is reduced accordingly.

--
Alan
http://taxtopics.net

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Harlan Lunsford wrote:
- quote -

It's 50% of spouse less the reduction for collecting at age
62. I haven't looked for awhile, but I think the reduction
is 30%. So it would be spouse x .5 x .7 = 35% of the spouse.

--
Alan
http://taxtopics.net

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HW "Skip" Weldon wrote:
- quote -

AHA! I think I've got it!

As I understand it, all of this takes place at the wife's
chosen retirement age, starting at 62, and does not
necessarily depend upon the husband's initial benefit
collection date.

That means that the questions and concerns raised in my post
are irrelevant. (That is not a new experience.)

Thanks Skip

Bill

Thanks Skip

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Harlan Lunsford ...
- quote -

Something like 23% of US SS programs recipients have not
paid in enough taxes to qualify on their own. These include
indigent, some spouse survivors, minor survivors, and
disable dependents. They generally get substantially less
than a fully paid retiree or disabled recipient, though
widowed spouses get higher.

The privatization reforms have overlooked this "welfare"
component of the program and how that will be administered.
Canada and some other countries explicitly delinate a
three-tier pension program- (1) a welfare minimum, (2)
mandatory contributions, and (3) voluntary contributions
(401K-like).

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William Brenner <wbrenner[at]nospamplease.net> wrote:

- quote -

I suspect the confusion is arising because, in your example,
we are focusing incorrectly on the spouse getting a
percentage of the husband's BENEFIT.

What the spouse's benefit does is allow the wife at some
point to use a percentage of the husband's EARNINGS RECORD.
So the wife would get to use 50% of her husband's earnings
record to calculate her check. Then we would apply the usual
rules - age, earned income limitation, family limit, etc. -
to calculate her actual benefit. She then gets the greater
of that amount or whatever her earnings record produces.

-HW "Skip" Weldon
Columbia, SC

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- quote -

The full spouse's benefit is 50%. However, one can only get
the full 50% if one waits until FRA. As this spouse is not
waiting until FRA but will start collecting at age 62, the
benefit is reduced accordingly.

--
Alan
http://taxtopics.net

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Let me see if I understand this issue via an example. The
names are omitted to protect the ignorant. The appropriate
SS web information turns out to be more than a bit
bureaucratically brain taxing.

Background:
A husband began to collect retirement benefits at age 62.

Could his spouse, upon reaching age 62, have begun to
collect a percentage of his benefit? Or could she have
begun to collect prior to reaching age 62? Neither was done
at the time.

Upon reaching age 65 - ten years after the husband began
collecting - the spouse began to collect her full benefit,
which was greater than the applicable spousal percentage of
the husband's.

The question is: If either answer in paragraph three (above) is yes, is
there a procedure by which the spouse can retroactively claim the three
(age 62-65) or more years of spousal benefits to which she might have
been entitled?

Thank you,

(Anonymous)

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Reed wrote:
- quote -

Please know that Social Security is not meant to be a
retirement plan. One pays a tax into a fund to provide
security to the general populace. (Can you spell "P O N Z
I"?)

People draw benefits based on their eligibility which is
written by congress. It may not be "fair" or perceived thus
by all, but it's better than nothing. AT least for those
over 50 right now.

ChEAr$,
Harlan Lunsford, EA n LA

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"jtc" <jtamchay[at]yahoo.com> wrote:

- quote -

I think the point is that the spouse must be of full
retirement age to get their full 50%. If this will happen 6
years from now, based on your original post, it seems that
you will qualify.

--
Vic Roberts
Replace xxx with vdr in e-mail address.

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Harlan Lunsford wrote:
- quote -

Well, I guess I'll have to find one of those 3 women. When
my wife of 40 years passed away at age 61, her SS benefit
(and the SS taxes she paid during her years of employment)
went up in smoke, simply disappeared per SSA.

To add to the insult, my Fed 1040 filing now is Single, not
MFJ, or even HOH.

Maybe a great country, but not an equitable plan.

--Reed

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- quote -

I am the OP and I was specifically stating that the husband
would collect at his full retirement age therefore the 50%
answer is the one I was hoping for.

thanks

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Harlan Lunsford wrote:
- quote -

It's 50% of spouse less the reduction for collecting at age
62. I haven't looked for awhile, but I think the reduction
is 30%. So it would be spouse x .5 x .7 = 35% of the spouse.

--
Alan
http://taxtopics.net

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Bill wrote:

- quote -

Furthermore, any previous spoue married to you at least ten
years will also qualify (provided she hasn't married again.)

So, a Don Juan who married at 20, divorced at 31; married
again, divorced at 42; married again, divorced at 53;
married again..... you get the picture, will be responsible
for at least three more women qualifying on his behalf.

Is this a great country, or what?

ChEAr$,
Harlan Lunsford, EA n LA

Moderator:
Thank you, Harlan, for helping me map out my next life.
An additional note: Marry orphans do you avoid having a
mother-in-law.

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jtamchay[at]yahoo.com (jtc) wrote:

- quote -

(Not a tax question, but ...)

The wife is not required to work or contribute a penny. She
qualifies based on her husbands SS entitlement, and the
spousal benefit is usually about 50% of the primary
beneficiary.

You can get full details at the following site:

http://www.ssa.gov/

Bill

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jtc wrote:

- quote -

This is a Social Security question, not an income tax
question. You may find an answer on www.ssa.gov

Missy Doyle

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