The dirty little secret of social security is that you’ll get the same payout regardless of when you start taking it, ACTUARIALLY speaking. If you delay a year, your payout goes up, but you just gave up a whole year of payout. As another pointed out, the break even on 62 vs 67 is at around year 78, but that’s just the straight cash. If you consider the investment potential even at 6-8% ROI, that break even goes well into the 80’s! So take the guaranteed money as early as you can, and if you don’t need it for living expenses, invest it in a good S&P500 mutual fund!
This is how SSA calculated it. If you retire at 70, you would have to live to 82 before you collect more money than if you'd retired at 62. Median life expectancy is 79, so SSA expects to pay out roughly the same to everyone in the aggregate.
Which means all those well intentioned financial planners have it wrong. As experienced vast majority of people take SS as soon as possible at 62, so it must be the better answer, compared to delaying.
This channel is way too underrated!!! Thank you for keeping us informed. We federal employees appreciate your hard work and dedication. Happy Holidays.
I was going to hold off until 70 but a couple of things: 1. Inflation this year is going to be BIG. Unlike pensions that are prorated, you will get the inflation COLA bump Jan 1 2023 IF YOU WERE ON the benefit on/before December 1st 2022. 2. If you are over 60, it doesn’t matter how much inflation there is, your work record WILL NOT be indexed. So with inflation, you are LOOSING $ for each year that you wait. 3. The 8% bump for each year you wait until you are 70 is NOT compounded, whereas COLA increases are.
My approach is a little different. One strategy you mentioned is to see if you can delay taking social security if your TSP withdraws is enough. My approach is just the opposite. I plan to take my social security at 62 so that I don't have to withdraw from my TSP and let it continue to grow. If the growth of TSP is greater than the annual increase of SS benefits if I waited then it is worth it to let it grow in TSP. A dollar I get from SS is a dollar I can keep in TSP to let it grow.
Three possible reasons for delaying SS are a) IRMAA, b) COLA for SS and c) RMDs. If you want to grow TSP, maybe better to do in Roth IRA. If you do take TSP or IRA withdrawals, you are right this increases sequence risk--reason for L Income allocation. My strategy is do partial Roth conversions in my Fidelity account but stay within 12% tax bracket. Good Luck to all retirees.
This is my thought, exactly. If i don’t get the money from SS, then I’ll have to pull from my TSP. That’s trading a guaranteed pot of money for a potential pot of money. And if i were to pass, my kids would get zero from SS, but would get my TSP, so it just makes sense from a estate-planning perspective to pull from SS before pulling from TSP.
Took mine at 62, got those health issues plus a child with a disibility that draws 50% of my PMI and married. Will hold off taking from TSP for monthly withdraws till in the age area were it is manatory.
I retired recently at 66 and I am surprised that my FERS pension amount plus my deceased husband's FERS spousal benefit is enough to live on right now without collecting my SS or touching my TSP yet. I hope to wait until 70 to take my SS when it is almost $1,000 more than it would have been at 66.
You da man! I direct everyone I know in my agency to your videos. I appreciate all of your wisdom and advice; every second of it. Take care of family and I wish you the best holidays. Looking forward to hearing from you in 2022.
one reason to delay your social security is for survivor benefits for the surviving spouse, if you take SS early and you die your spouse will only get what you were getting, depending on when they file for survivor benefits
Is this the concept you are trying to explain? If I spend my saved cash (earning interest at .01%) instead of taking social security, it is equivalent to investing my cash and getting a much higher return. Also, if I live 3 more years, I will be the 1st person in my family ever to be eligible for social security. I am the youngest of 3 children. Parents, grandparents, brothers, didn't live long enough to get social security. Great grandparents died before social security was even a thing. I think I am taking it early.
Another thing you didn’t cover is the tax treatment of SS payouts vs TSP payouts. 100% of your TSP payouts are taxed at the earned income rate, whilst no more than 85% of your SS payouts are taxed. For some, SS payouts aren’t taxed at all!
I did the math of taking SS at 63 or at say until age 85 and the total payout difference was about $120K. Taking SS at 63, i would've received about $220K in SS benefits by 70. So....to me take it early. If you are determined to delay the benefit for a larger benefit, then pay yourself the difference out of your TSP until the age you want to start taking SS.
Basically, when deciding whether or not to take Social Security early, you’re gambling on whether or not you will live to at least 78 which is the “break even point” for “62 vs 67” as the starting age for Social Security benefits. If You take early and die early, the money that has been drawn is for your heirs to inherit. Anything not drawn upon your death, the Government keeps it all.
My dad was also a fed/veteran who retired and took SSI at 62 so he could invest it all. He's now 72, healthy and doing very well. Something to think on, I plan to do the same.
Thank you for this. I always figured I'd take it at 62 because why wait when given a chance to get back stolen money? But if I consider it an investment and factor the rate of return in delaying and factor for the spousal benefit maybe my plan will change. Of course it's not an investment so it's increasingly probable insolvency may still cause me to draw at 62 if it's still available by then.
The older you get, the closer to death. Enjoy the money while you can. If it's not enough to enjoy, then you haven't planned correctly, and therfore you should hold off on retirement.
Is always good to see how many years you need to wait to caught up the amount of money you got starting, let say at 64 vs 67. Those three years earning SS total is equal to X. How many years you need to caught up the difference if you retire at 67, that is an important matter to calculate
Because there are VERY valid reasons for doing so as he explained. I'm waiting until FRA and my husband who is 5 years younger is going to wait until age 70.
@@Bonnie-yu3kj true. then I in all seriousness and sincerity hope you’re able to. 🙏🏽 I on the other hand prefer get lower SOMETHING over a possible NOTHING any day.
It's a moving target for me. I'll put my retirement where I can equal my current earnings. If that's a lucky just TSP and FERS; 60. If that's a working TSP, FERS, and social security; 67. Whenever the targets align.
What If I received disability retirement from federal government and just got approved disability by SSA,what benefits we get and I would like to know how works the Offset ?
New sub here. Great info. I am taking mine this year at 62 since my combined retirement income will be the same as my income from work. It will be even more with Dib benefits. Why wait?
My issue is that once I retire I will need income. I have heard that you can take SS at, say, 66 and then repay it at 69.75, then re-apply at 70 at a higher rate. Is that true?
If I delay my retirement to 67 years.I have already acknowledged that collecting any Social Security Retirement at my age now 62 years age. I still want to work I would be taxed at 80%.Which is a punishment for collecting this Soc. Sec. Retirement early. My father was never punish to work at age of late 60's but he had a person and friend to help with his taxes Yet he was collecting VA Nonservice connection disability Pension. Which I believe he was punish later in life He was fined about $800.00 for his spouse collecting something I fought with my U.S.Senator at the time. I am working in hardest condition in Federal Services for the Veterans Administration.
Hey Dallon. Thanks for the great insights. Stupid question?: Assuming I retire USPS at age 60, I'll get two years' Supplemental payments that cover projected age 62 SS, right? Upon age 62, Supplemental payments end. Do I then "have to" start taking SS? Or can I choose to delay?
Was wondering if it would be good to take Social Security at Full Retirement age and invest the money in 401K?... Dave Ramsey has made a video that seems to say this is a good idea. Still working at 67 years old and still healthy so plan to continue to work for a while.
Great video. I work for the government and I'm single, no kids, and will probably retire with the government. I plan to retire early as possible given statistically it's unlikely I won't make it to 90.
I am helping a friend with his medicare sign up, he has severe parkinson's disease and has been on disability for 14 years. I am looking for some direction on gettin answers to a few of my questions. He was a USPS carrier since 1979 until his disability required him to stop. Are you available for some advise?
@PlanYourFederalBenefits can you do a video on how the zeros each year for not working will effect your Social Security monthly payments? The majority of us who retire will have a few years of zeros in the Social Security calculations...
An exception to the idea that, "If you are still working, it almost never makes sense to take Social Security . . . ", which supports your earlier statement that there is no cookie-cutter approach that works for everyone. If your retirement is going to be subject to the Windfall Elimination Provision, taking SS when you hit full-retirement age YEAR can allow you to collect at the unreduced amount until such time as you start collecting your WEP-impacted pension, the penalty of which does not kick in until pension payments start. A few years of collecting a full SSA check that is reduced slightly due to not waiting until 70 may more than offset waiting to collect the full amount and having it reduced by almost $600 a month by the WEP. In my situation, waiting until my full retirement age year meant I wasn't penalized for working while collecting, but since I will be 69 when I retire, I will have collected over $60K by the time I start drawing my pension and become subject to WEP. You have to math the heck out of it, run your own scenarios, and figure out where your own break-even point falls. You may be very surprised by the results.
This does not take into account the retirees ability to enjoy their money. A person who retires at 62 will be eight years younger and have eight more years to enjoy the money. A person at 70 is going to be declining much more and likely won't have eight more years of being able to travel and enjoy life. If you want to sit and stare out a window while you have a nice car you can't drive- wait and hold out for the cash. Personally, I would value being able to cram experiences into that eight year window. Also, note people die every year. You are not guaranteed to live to 62, let alone to the break even retirement date.
Goodness! Give me a break. I can see why he said most take at age 62. That seems to be the prevailing mentality. Telling yourself you aren't guaranteed to live until 62, is simply a cop out. There are excellent reasons for delaying which is what I'm doing and I'm past 62 so there goes your theory LOL Also, there are actually some of us who take care of ourselves and take zero meds, run marathons and are in excellent shape. We do live WELL pass age of 62 and I want the most I can get. You won't see me staring out a window with a nice car. I'll be hiking all around the USA as well as my husband. People need to quit stereotyping seniors.
@@Bonnie-yu3kj it isn't a cop out. I'm in my low thirties and have lost several classmates already. Car wrecks, heart attacks, and other sudden death events happen every day. Males life expectancy is only 73. You do whatever you want, forgo life and car insurance, hell, forgo home insurance. I'm sure nothing bad will ever happen as you're the main character.
If a federal employee passes away before her spouse, the spouse cannot roll over what’s in her TSP say into an IRA, he would have to take all the money out and pay taxes on it that tax year? Also if her kids were her only survivors the same situation would apply, right?
My husband passed away. I can take his ss now but haven't yet. I work and my ss will be higher. If I take his now , age 62 and retire myself, how does my ss get affected ? Will it stay at my estimated amount at my FRA of 67 or will it get decreased?
Think about the old days when you could draw at 62, pay it all back at 70,, keep your interest, and redraw the new benefit if you were healthy :) that loop hole got closed
When you discussed the situation of a Federal employee trying to decide to take early SS at age 62 because they have a Disabled Adult Child (DAC) and would trigger a benefit for their disabled child.... you failed to point out a hugely important detail. This situation may ALSO trigger a decent sized SPOUSAL benefit in ADDITION to the separate benefit of the disabled child. It's called a Spousal "Child in Care" benefit....and most importantly, the spouse who in the home providing care DOES NOT HAVE TO BE 62. They can be much younger.... as long as the Federal employee worker filing for benefits...is 62. The DAC benefit and Spousal CIC benefit will be subject to family maximum rules. Please do not fail to take this spousal benefit when running the numbers to help a Federal employee decide whether or not to take benefits at 62. The numbers are hugely affected by this spousal benefit.
what if my husband is younger than and he makes more money than me during working years but I will turn 65 few years ahead of him. Can I claim thru my husband's social security even though he is still working and not yet claiming his social security? Thanks!
I plan to retire at 63 1/2, live off my pension and TSP for a year, and start SS at around 64 1/2. This strategy provides higher SS, somewhat early retirement, and just a small dent in my TSP. I originally planned to start SS at 63 1/2 but with the stock market the is such bad shape, I decided to spend a small amount of TSP and increase my SS.
Great question. That is the age that your social security benefit is the greatest. After the age 70, your benefit does not increase even if you wait longer to use it.
Hey Frank, We do have an office but right now we do all our meetings online. You can book one here. hawsfederaladvisors.com/work-with-us/ Have a great day!
I haven't decided but the SSB only lasts until 62. If the budget goes as planned, and other sources make up that difference, I may delay until 65. That's more because that's when medicare/medicaid are an additional cost, other than normal insurance. It just seems easier to have those added costs pulled from social security instead of my normal budget. Then again, with plans on being an expat, that medicare/medicaid is essentially worthless unless I return to the states - then that "catch-up" penalty is due before one can use those benefits. It'd be nice if they make medicare portable, for those who do retire out of the country. Good things to consider in a retirement plan. Thanks!
Single people get screwed on Social Security and Pension, as there is no survivor benefit to either. If you want to leave anything to your adult children or family best to leave TSP untouched as much as possible.
Question: Does the spouse get half of higher earner's benefit or full amount? In the example it was stated the spouse's benefit increased from $1,000 to $2,000. Would it not remain at $1,000 since half of higher earner's benefit is equal to current benefit? I also thought it was less than 50% if the spouse is also not at full retirement age. For example higher earning spouse benefit at full retirement age (67) is X, then other spouse at age 62 would receive 35%, not 50%, at age 62.
This is a HUGE point that financial planners miss a lot of the time. My wife was going to lose a huge percentage of my social security. So we had to wait until my wife reached the full retirement age and not be penalized. Only then could we really sit down to decide when I should take social security.
I think you are talking about two different things. Spousal benefit is the one you are describing, where both are living. When the higher earning spouse dies, the living spouse gets the higher of the two ( survivor benefit).
Both my parents died by 71. They both had an illness that took them. So if they waited, they would only have gotten 1 year of S.S ! I have a lot to think of, but they are what I know.
Everyone thinks they will live for ever, but the reality is people die every day. Ask how many of those people thought they were going to die when they did.
The dirty little secret of social security is that you’ll get the same payout regardless of when you start taking it, ACTUARIALLY speaking.
If you delay a year, your payout goes up, but you just gave up a whole year of payout.
As another pointed out, the break even on 62 vs 67 is at around year 78, but that’s just the straight cash. If you consider the investment potential even at 6-8% ROI, that break even goes well into the 80’s!
So take the guaranteed money as early as you can, and if you don’t need it for living expenses, invest it in a good S&P500 mutual fund!
Great advice and it makes sense!
This is how SSA calculated it. If you retire at 70, you would have to live to 82 before you collect more money than if you'd retired at 62. Median life expectancy is 79, so SSA expects to pay out roughly the same to everyone in the aggregate.
Which means all those well intentioned financial planners have it wrong. As experienced vast majority of people take SS as soon as possible at 62, so it must be the better answer, compared to delaying.
@@jscott1000 I have seen people say to spend TSP money and delay SS. That's insane!
Yep If my dad waited he would have got SS for 2 years before he passed from Cancer.
This channel is way too underrated!!! Thank you for keeping us informed. We federal employees appreciate your hard work and dedication. Happy Holidays.
Thanks for being part of the community and Happy Holidays :)
SOOO underrated! This kid is brilliant!
I was going to hold off until 70 but a couple of things:
1. Inflation this year is going to be BIG. Unlike pensions that are prorated, you will get the inflation COLA bump Jan 1 2023 IF YOU WERE ON the benefit on/before December 1st 2022.
2. If you are over 60, it doesn’t matter how much inflation there is, your work record WILL NOT be indexed. So with inflation, you are LOOSING $ for each year that you wait.
3. The 8% bump for each year you wait until you are 70 is NOT compounded, whereas COLA increases are.
My approach is a little different. One strategy you mentioned is to see if you can delay taking social security if your TSP withdraws is enough. My approach is just the opposite. I plan to take my social security at 62 so that I don't have to withdraw from my TSP and let it continue to grow. If the growth of TSP is greater than the annual increase of SS benefits if I waited then it is worth it to let it grow in TSP. A dollar I get from SS is a dollar I can keep in TSP to let it grow.
Thanks for sharing!
Three possible reasons for delaying SS are a) IRMAA, b) COLA for SS and c) RMDs. If you want to grow TSP, maybe better to do in Roth IRA. If you do take TSP or IRA withdrawals, you are right this increases sequence risk--reason for L Income allocation. My strategy is do partial Roth conversions in my Fidelity account but stay within 12% tax bracket. Good Luck to all retirees.
This is my thought, exactly. If i don’t get the money from SS, then I’ll have to pull from my TSP. That’s trading a guaranteed pot of money for a potential pot of money. And if i were to pass, my kids would get zero from SS, but would get my TSP, so it just makes sense from a estate-planning perspective to pull from SS before pulling from TSP.
@@eandrgoodwin Exactly. Like I said, every dollar I get from SS is a dollar I get to keep in TSP to work for me.
❤
Took mine at 62, got those health issues plus a child with a disibility that draws 50% of my PMI and married. Will hold off taking from TSP for monthly withdraws till in the age area were it is manatory.
Thanks for sharing!
I retired recently at 66 and I am surprised that my FERS pension amount plus my deceased husband's FERS spousal benefit is enough to live on right now without collecting my SS or touching my TSP yet. I hope to wait until 70 to take my SS when it is almost $1,000 more than it would have been at 66.
Great to hear! Thanks for sharing!
A SSA employee and just love all the important information your providing.
Thank you for watching!
You da man! I direct everyone I know in my agency to your videos. I appreciate all of your wisdom and advice; every second of it. Take care of family and I wish you the best holidays. Looking forward to hearing from you in 2022.
Happy holidays to you as well! Thanks for being part of the community!
one reason to delay your social security is for survivor benefits for the surviving spouse, if you take SS early and you die your spouse will only get what you were getting, depending on when they file for survivor benefits
Is this the concept you are trying to explain? If I spend my saved cash (earning interest at .01%) instead of taking social security, it is equivalent to investing my cash and getting a much higher return. Also, if I live 3 more years, I will be the 1st person in my family ever to be eligible for social security. I am the youngest of 3 children. Parents, grandparents, brothers, didn't live long enough to get social security. Great grandparents died before social security was even a thing. I think I am taking it early.
Another thing you didn’t cover is the tax treatment of SS payouts vs TSP payouts. 100% of your TSP payouts are taxed at the earned income rate, whilst no more than 85% of your SS payouts are taxed. For some, SS payouts aren’t taxed at all!
Good point! Thanks for sharing!
Awesome information here. Thank you so much!!
Glad it was helpful!
Another great topic. Especially the older spouse and spousal benefits.
Thank you!
I did the math of taking SS at 63 or at say until age 85 and the total payout difference was about $120K. Taking SS at 63, i would've received about $220K in SS benefits by 70. So....to me take it early. If you are determined to delay the benefit for a larger benefit, then pay yourself the difference out of your TSP until the age you want to start taking SS.
Basically, when deciding whether or not to take Social Security early, you’re gambling on whether or not you will live to at least 78 which is the “break even point” for “62 vs 67” as the starting age for Social Security benefits. If You take early and die early, the money that has been drawn is for your heirs to inherit. Anything not drawn upon your death, the Government keeps it all.
I've run the numbers myself. This is a true statement.
As Clint Eastwood said "are you feeling lucky"?
Tomorrow is never guaranteed.
Exactly!
Drawing at 62. Thank you for that information
Exactly, takes about 10 years for the break even point. Unless you just HAVE to have the full SS amount, take it 62 and don't look back.
Just FYI, there is no SS earnings limit if you are older than your full retirement age.
Great point! Have a great day!
Love this, great honest information, thank you!
Glad it was helpful!
My dad was also a fed/veteran who retired and took SSI at 62 so he could invest it all. He's now 72, healthy and doing very well. Something to think on, I plan to do the same.
Thanks for sharing Jeff!
Thank you for this. I always figured I'd take it at 62 because why wait when given a chance to get back stolen money? But if I consider it an investment and factor the rate of return in delaying and factor for the spousal benefit maybe my plan will change. Of course it's not an investment so it's increasingly probable insolvency may still cause me to draw at 62 if it's still available by then.
Thanks for sharing Rick
The older you get, the closer to death. Enjoy the money while you can. If it's not enough to enjoy, then you haven't planned correctly, and therfore you should hold off on retirement.
Thanks for sharing!
Is always good to see how many years you need to wait to caught up the amount of money you got starting, let say at 64 vs 67. Those three years earning SS total is equal to X. How many years you need to caught up the difference if you retire at 67, that is an important matter to calculate
Very helpful information
Tomorrow is promised to no one. If you need it, take it. If you don’t need it, what reason do you have to delay something you PAID INTO!
My sentiments exactly…. I will only not take mine if I continue to work.
Because there are VERY valid reasons for doing so as he explained. I'm waiting until FRA and my husband who is 5 years younger is going to wait until age 70.
@@Bonnie-yu3kj true. then I in all seriousness and sincerity hope you’re able to. 🙏🏽 I on the other hand prefer get lower SOMETHING over a possible NOTHING any day.
GOOD STUFF THANK YOU
It's a moving target for me. I'll put my retirement where I can equal my current earnings. If that's a lucky just TSP and FERS; 60. If that's a working TSP, FERS, and social security; 67. Whenever the targets align.
Thanks for sharing!
What If I received disability retirement from federal government and just got approved disability by SSA,what benefits we get and I would like to know how works the Offset ?
New sub here. Great info. I am taking mine this year at 62 since my combined retirement income will be the same as my income from work. It will be even more with Dib benefits. Why wait?
Thanks for being part of the community!
My issue is that once I retire I will need income. I have heard that you can take SS at, say, 66 and then repay it at 69.75, then re-apply at 70 at a higher rate.
Is that true?
If I delay my retirement to 67 years.I have already acknowledged that collecting any Social Security Retirement at my age now 62 years age. I still want to work I would be taxed at 80%.Which is a punishment for collecting this Soc. Sec. Retirement early. My father was never punish to work at age of late 60's but he had a person and friend to help with his taxes Yet he was collecting VA Nonservice connection disability Pension. Which I believe he was punish later in life He was fined about $800.00 for his spouse collecting something I fought with my U.S.Senator at the time. I am working in hardest condition in Federal Services for the Veterans Administration.
Hey Dallon. Thanks for the great insights. Stupid question?: Assuming I retire USPS at age 60, I'll get two years' Supplemental payments that cover projected age 62 SS, right? Upon age 62, Supplemental payments end. Do I then "have to" start taking SS? Or can I choose to delay?
You can choose to delay if you'd like.
No
Was wondering if it would be good to take Social Security at Full Retirement age and invest the money in 401K?... Dave Ramsey has made a video that seems to say this is a good idea. Still working at 67 years old and still healthy so plan to continue to work for a while.
Good video
Great video. I work for the government and I'm single, no kids, and will probably retire with the government. I plan to retire early as possible given statistically it's unlikely I won't make it to 90.
I am helping a friend with his medicare sign up, he has severe parkinson's disease and has been on disability for 14 years. I am looking for some direction on gettin answers to a few of my questions. He was a USPS carrier since 1979 until his disability required him to stop. Are you available for some advise?
@PlanYourFederalBenefits can you do a video on how the zeros each year for not working will effect your Social Security monthly payments? The majority of us who retire will have a few years of zeros in the Social Security calculations...
Close
An exception to the idea that, "If you are still working, it almost never makes sense to take Social Security . . . ", which supports your earlier statement that there is no cookie-cutter approach that works for everyone.
If your retirement is going to be subject to the Windfall Elimination Provision, taking SS when you hit full-retirement age YEAR can allow you to collect at the unreduced amount until such time as you start collecting your WEP-impacted pension, the penalty of which does not kick in until pension payments start. A few years of collecting a full SSA check that is reduced slightly due to not waiting until 70 may more than offset waiting to collect the full amount and having it reduced by almost $600 a month by the WEP.
In my situation, waiting until my full retirement age year meant I wasn't penalized for working while collecting, but since I will be 69 when I retire, I will have collected over $60K by the time I start drawing my pension and become subject to WEP. You have to math the heck out of it, run your own scenarios, and figure out where your own break-even point falls. You may be very surprised by the results.
This does not take into account the retirees ability to enjoy their money. A person who retires at 62 will be eight years younger and have eight more years to enjoy the money. A person at 70 is going to be declining much more and likely won't have eight more years of being able to travel and enjoy life. If you want to sit and stare out a window while you have a nice car you can't drive- wait and hold out for the cash. Personally, I would value being able to cram experiences into that eight year window. Also, note people die every year. You are not guaranteed to live to 62, let alone to the break even retirement date.
Goodness! Give me a break. I can see why he said most take at age 62. That seems to be the prevailing mentality. Telling yourself you aren't guaranteed to live until 62, is simply a cop out. There are excellent reasons for delaying which is what I'm doing and I'm past 62 so there goes your theory LOL Also, there are actually some of us who take care of ourselves and take zero meds, run marathons and are in excellent shape. We do live WELL pass age of 62 and I want the most I can get. You won't see me staring out a window with a nice car. I'll be hiking all around the USA as well as my husband. People need to quit stereotyping seniors.
@@Bonnie-yu3kj it isn't a cop out. I'm in my low thirties and have lost several classmates already. Car wrecks, heart attacks, and other sudden death events happen every day. Males life expectancy is only 73. You do whatever you want, forgo life and car insurance, hell, forgo home insurance. I'm sure nothing bad will ever happen as you're the main character.
If a federal employee passes away before her spouse, the spouse cannot roll over what’s in her TSP say into an IRA, he would have to take all the money out and pay taxes on it that tax year? Also if her kids were her only survivors the same situation would apply, right?
That is what I was told on both questions. The buzz word “Transfer” into IRA not roll over, so that you are out penalized.
My husband passed away. I can take his ss now but haven't yet. I work and my ss will be higher. If I take his now , age 62 and retire myself, how does my ss get affected ? Will it stay at my estimated amount at my FRA of 67 or will it get decreased?
My concern is, for my TSP, should I take the life time or should I take higher amount ( which I really don’t need it).
Think about the old days when you could draw at 62, pay it all back at 70,, keep your interest, and redraw the new benefit if you were healthy :) that loop hole got closed
When you discussed the situation of a Federal employee trying to decide to take early SS at age 62 because they have a Disabled Adult Child (DAC) and would trigger a benefit for their disabled child.... you failed to point out a hugely important detail. This situation may ALSO trigger a decent sized SPOUSAL benefit in ADDITION to the separate benefit of the disabled child. It's called a Spousal "Child in Care" benefit....and most importantly, the spouse who in the home providing care DOES NOT HAVE TO BE 62. They can be much younger.... as long as the Federal employee worker filing for benefits...is 62. The DAC benefit and Spousal CIC benefit will be subject to family maximum rules. Please do not fail to take this spousal benefit when running the numbers to help a Federal employee decide whether or not to take benefits at 62. The numbers are hugely affected by this spousal benefit.
Take that money when you can and invest it yourself. No use holding off.
what if my husband is younger than and he makes more money than me during working years but I will turn 65 few years ahead of him. Can I claim thru my husband's social security even though he is still working and not yet claiming his social security? Thanks!
Nope. Have to wait until he retires.
I plan to retire at 63 1/2, live off my pension and TSP for a year, and start SS at around 64 1/2. This strategy provides higher SS, somewhat early retirement, and just a small dent in my TSP. I originally planned to start SS at 63 1/2 but with the stock market the is such bad shape, I decided to spend a small amount of TSP and increase my SS.
What is significant about SS and age 70?
Great question. That is the age that your social security benefit is the greatest. After the age 70, your benefit does not increase even if you wait longer to use it.
Do you have an office for a consultation?
Hey Frank, We do have an office but right now we do all our meetings online. You can book one here. hawsfederaladvisors.com/work-with-us/
Have a great day!
When should I Start Social Security as a Federal Employee in high inflation?
If your FRA is 67 why is 65 such a statistical unpopular age?
I haven't decided but the SSB only lasts until 62. If the budget goes as planned, and other sources make up that difference, I may delay until 65. That's more because that's when medicare/medicaid are an additional cost, other than normal insurance. It just seems easier to have those added costs pulled from social security instead of my normal budget. Then again, with plans on being an expat, that medicare/medicaid is essentially worthless unless I return to the states - then that "catch-up" penalty is due before one can use those benefits. It'd be nice if they make medicare portable, for those who do retire out of the country.
Good things to consider in a retirement plan. Thanks!
Thanks for sharing! Have a great day!
Single people get screwed on Social Security and Pension, as there is no survivor benefit to either. If you want to leave anything to your adult children or family best to leave TSP untouched as much as possible.
True…no one gets the benefit of the SS
Eventually RMD's prohibit that.
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Question: Does the spouse get half of higher earner's benefit or full amount? In the example it was stated the spouse's benefit increased from $1,000 to $2,000. Would it not remain at $1,000 since half of higher earner's benefit is equal to current benefit? I also thought it was less than 50% if the spouse is also not at full retirement age. For example higher earning spouse benefit at full retirement age (67) is X, then other spouse at age 62 would receive 35%, not 50%, at age 62.
This is a HUGE point that financial planners miss a lot of the time. My wife was going to lose a huge percentage of my social security. So we had to wait until my wife reached the full retirement age and not be penalized. Only then could we really sit down to decide when I should take social security.
I think you are talking about two different things. Spousal benefit is the one you are describing, where both are living. When the higher earning spouse dies, the living spouse gets the higher of the two ( survivor benefit).
What if I die before I start SS? What does my wife get?
They are generally eligible for social security survivor benefits based on your working history
Both my parents died by 71. They both had an illness that took them. So if they waited, they would only have gotten 1 year of S.S ! I have a lot to think of, but they are what I know.
Everyone thinks they will live for ever, but the reality is people die every day. Ask how many of those people thought they were going to die when they did.
Why does social security not include locality pay.?
Great question!