# You need to know these Social Security tips now, even if you're years from retirement



## sargentodiaz (Mar 17, 2019)

​  *Good stuff to know even if you already draw it.*
​  1. Commit your full retirement age to memory​  2. Know what the average benefit looks like
​  3. Report mistakes on your earnings record​  4. Be aware of the earnings test limits​  5. Know that delaying benefits pays off​  All the details plus an offer @ https://www.usatoday.com/story/mone...now-even-before-retirement-planning/39192385/
​ ​


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## OneEyedDiva (Mar 23, 2019)

Good to know although I took mine early...10 years ago. I used to be a proponent of taking it early, as most seniors are but because of the reduction in benefits that the social security administration expects to happen by 2024, I now advise against it.


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## Floridatennisplayer (Mar 23, 2019)

Delaying benefits doesn’t always pay off. Horrible generalization.


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## Butterfly (Mar 23, 2019)

Floridatennisplayer said:


> Delaying benefits doesn’t always pay off. Horrible generalization.



I agree.


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## Don M. (Mar 23, 2019)

Picking the best age to apply for SS benefits would be good....IF a person know how long they would live.  The SS administration probably loves someone who applies for benefits at age 70, then passes at age 71.  Conversely, a person entering the system at age 62 and living to be in their 90's would get back several times what they paid in during their working years.


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## mathjak107 (Mar 24, 2019)

if you are retiring early  and plan efficiently then the only difference between delaying is  in being more stock market dependent or more longevity dependent if you count on portfolio income as well with the social security . ..


if you file early more of your income comes from your own resources down the road and less from uncle sam ..  your ss check is 70% bigger at 70 then at 62 .THAT CAN BE A WHOLE LOT LESS DEPENDENT ON MARKETS AND RATES .


   most of those who take ss early and count on portfolio income are rolling the dice on their portfolio's doing well and markets and rates being able to support them in tough times . the higher draw creates higher sequence risk .


so you are rolling the dice either way , you either need to be lucky with markets and rates or lucky with longevity..

i doubt there will be any ss reductions in amounts and if there was it would be across the board effecting everyone collecting or not ..like everything congress does they will fully fund ss in the 11th hour . any changes are usually grand fathered too to those eligible .


the reality is you,  need to have one in a couple live to 90 if delaying  to equal taking ss earlier  and spending down a balanced portfolio to delay ...  so you are either betting on one of you living to at least 90  or you are betting on typical 6% real returns from a balanced portfolio just to break even .  choose your poison ....  i took mine at 65 for the record .  i  was going to delay but with us spending an extra 40k a year from our own money fronting ourselves the ss while delaying plus losing a lifetime of compounding on that money just made delaying not worth it .

my wife could not get a 4500 dollar a year adder to her benefit until i filed either ..  i work one day a week and i had to wait until the year i would be fra so i could earn at least 45k  and not give ss back under the special rules or i likely would have filed sooner .. 

but for non investors or those living on just ss , delaying retirement can be the biggest silver bullet to fixing an under funded retirement .


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## mathjak107 (Mar 24, 2019)

Don M. said:


> Picking the best age to apply for SS benefits would be good....IF a person know how long they would live.  The SS administration probably loves someone who applies for benefits at age 70, then passes at age 71.  Conversely, a person entering the system at age 62 and living to be in their 90's would get back several times what they paid in during their working years.


there is a lot more to consider because  there is no inherent  "better" ...

for those with the choice to retire early and delay, and who will be spending down invested assets delaying to 70 ,  the break even is actually at 90 .

  so delaying ss and having one in a couple hit 90 would give you the same balance and return as someone  taking ss early , collecting more checks  and not  spending down a balanced portfolio while delaying or spending money that could have been invested . so in other words taking ss early will have you spending more from your portfolio forever starting at age 70  than delaying will .

think about this fact very carefully ..taking it early ,you got more money coming in earlier from ss  but you  will be shelling out more money forever from your own resources  starting at 70-1/2 because that 70% larger check at 70 would need less money from your portfolio to make up the same income level...  this is over looked all the time when people argue for filing earlier .

so the crossover age is 90 based  on delaying vs the alternative of having a 50/50 or 60/40 portfolio and taking ss early vs a 70% bigger check at 70 and drawing less from your own money going forward .

you can see that in the chart above based on work done by famed researcher michael kitces


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## Don M. (Mar 24, 2019)

mathjak107 said:


> there is a lot more to consider because  there is no inherent  "better" ...for those with the choice to retire early and delay, and who will be spending down invested assets delaying to 70 ,  the break even is actually at 90, you can see that in the chart above based on work done by famed researcher michael kitces



Yup, there is No "Better"...everyone's individual circumstances are different.  Personally, I jumped in as soon as I became eligible, and the wife, who never worked outside the home, got in for her benefits as soon as she became eligible.  I ran the numbers a couple of weeks ago, and so for I have gotten back over 3&1/2 times what I paid in over my working career, and if we live as long as our parents did...early 90's...we will get 6 or 7 times what I paid in.


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## mathjak107 (Mar 24, 2019)

social security is means tested so the more you make the less you get . a low income wage  earner has a dollar buy 6 times the benefit a high wage earner gets .

What most people don’t know is that our employment tax dollars don’t all buy the same amount of future benefit. Some of our employment tax dollars buy six times as much in benefits as others.

According to the most recent Trustees Report, for instance, the first $767 of “average indexed monthly earnings” (a complex formula that adjusts earnings over time) is credited at a 90 percent rate, assuring the lowest wage workers of a retirement benefit nearly equal to their earned wage.

Wages of more than $767 a month but less than $4,624 a month are credited at a 32 percent rate. This means retirement benefits increase at a much lower rate. The benefit pinching, however, does not end there.

More means less

For wages of more than $4,624 a month up to the wage base maximum ($113,700 for 2013), the crediting rate is only 15 percent. Thus, all the wages earned — and employment taxes paid — over that $55,488-a-year “bend point” gain benefits at only one-sixth the rate of the lowest wage earners.

In effect, the Social Security benefits formula functions as a sharply graduated benefits “tax,” reducing the benefits that accrue to higher wages by 85 percent. The higher your means, the lower your benefit.


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## Don M. (Mar 24, 2019)

mathjak107 said:


> social security is means tested so the more you make the less you get . a low income wage  earner has a dollar buy 6 times the benefit a high wage earner gets.  In effect, the Social Security benefits formula functions as a sharply graduated benefits “tax,” reducing the benefits that accrue to higher wages by 85 percent. The higher your means, the lower your benefit.



Yes, SS is...and should be....geared more towards Seniors who have little or no other sources of income.  Without it, half our Seniors would probably be in dire financial straits.


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## mathjak107 (Mar 24, 2019)

Don M. said:


> Yes, SS is...and should be....geared more towards Seniors who have little or no other sources of income.  Without it, half our Seniors would probably be in dire financial straits.


ss is insurance .... assets should have nothing to do with what it pays  nor current income if retired... it is bad enough it is not only means tested by the way i stated above but if you go over a certain income  you are double taxed on it too .. .


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## mathjak107 (Mar 24, 2019)

most people don't have the assets to layout to delay ss and so they really have no choice  in whether to delay or not ....in my opinion it makes no sense to delay , not have enough assets to lay out the ss up front and first start increasing your income after age 70 ....  if you delay and retire early all that should happen is you lay out the ss , then at age 70 you  get a 70% bigger check and for as long as you live  THE SAME LEVEL OF INCOME CONSISTS OF LESS YOUR MONEY AND MORE SS .  

but income should stay constant regardless of when you file ... if you are doing it any other way you seriously may want to evaluate your choice and lifestyle


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## mathjak107 (Mar 25, 2019)

the biggest tip is this..take the time to learn all you can on your own ..these scripted clerks you get at ss   are not very well trained at all and you can't even count on getting even the most basic questions answered correctly ... social security could be one of the biggest financial decisions in your life ...i think it warrants taking the time to learn what you can  and spend  more time learning about it ,  then you spend researching  buying a refrigerator or a car ...

EIGHTY-TWO PERCENT OF widows and widowers who are receiving Social Security benefits are entitled to a higher monthly payment but were not made aware of an option allowing them to claim it, according to a recent audit report.


https://www.usnews.com/news/nationa...social-security-underpays-widows-and-widowers


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