# Anyone use one of those Social Security advisory services?



## Floridatennisplayer (Mar 28, 2017)

Can't seem to get a straight answer from SSA.  My wife and I are both 62 and I have made considerably more money than her as she has always been part time.  Our original plan was to take Social Security at age 65 to match Medicare starting and she would claim half of my Social Security which would be quite a bit more than hers alone.   

It looks like her part-time job is being phased out so she asked if she should go ahead and claim Social Security now and if she did that would she be able to revert to 50% of mine at age 65.  One person at the Social Security administration told me yes that is available another one told me no and a third one told me that we both need to file now and for me to suspend and then when I turn 65 activate it.

I don't want to screw something up so I thought about trying some of these S security consulting firms, any ideas?


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## Ken N Tx (Mar 29, 2017)

My wife took the Spousal Award when I retired at 64..She gets the same Award without any increase when we turned 66.

Not sure if this might help..

SSA Calculator


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## mathjak107 (Sep 10, 2018)

Floridatennisplayer said:


> Can't seem to get a straight answer from SSA.  My wife and I are both 62 and I have made considerably more money than her as she has always been part time.  Our original plan was to take Social Security at age 65 to match Medicare starting and she would claim half of my Social Security which would be quite a bit more than hers alone.
> 
> It looks like her part-time job is being phased out so she asked if she should go ahead and claim Social Security now and if she did that would she be able to revert to 50% of mine at age 65.  One person at the Social Security administration told me yes that is available another one told me no and a third one told me that we both need to file now and for me to suspend and then when I turn 65 activate it.
> 
> I don't want to screw something up so I thought about trying some of these S security consulting firms, any ideas?



this was an older post , but it is a question that keeps coming up as well as people are still  planning around  options that no longer exist.
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only those 62 or older in 2015 have choices between letting their own grow and taking spousal .

everyone who was not grand fathered in can only get their own benefit. when they file for their own benefit they are also deemed filing for spousal .

any difference between 1/2 their spouses full and their full is added to their own benefit .  if you took ss early then any spousal gets added on top of your early benefit. it will always be less than 1/2 if you filed early.

prior to the change ,  at fra you had a choice of your own or filing for just 1/2 your spouses leaving your own to grow. that was called restricted application . that and file and suspend no longer are options unless you were grand fathered in . .


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## mathjak107 (Sep 10, 2018)

also another point i should mention is there is nothing inherent in delaying that automatically gives you more money to spend or a bigger balance for heirs compared to filing early  .you see this myth all the time posted , how waiting gives them more money . but that is not always true . the only time it is true is if you work and delay .

not spending down invested assets  when taking ss early or investing money you get that could be invested if you take ss early  can add a lot of money back in to the equation   .  by the same token ,  to match a balanced portfolio  under average market outcomes   ,delaying requires you or a spouse  to live to 90 to equal that amount .

so it really boils down to betting on at least seeing average market outcomes if you take ss early or betting on you or a spouse  living  to age 90 if delaying ss since that is what it takes to get to the tipping point .   

if you or a spouse live to 95 then delaying ss wins .  if you and your spouse live less than 90 , then taking ss early and investing wins . the odds really favor investing and taking ss early but that does not mean it is guaranteed .

both can provide higher income along the way . if markets are at least average outcomes then raises can be taken when you invest and take ss early  all along the way  possibly even beating the higher ss check by age 70 .
so don't get to wrapped up in thinking one is better than the other because they are both dependent on  certain expectations . the real deal is do you want to bet more on markets or more on longevity for the "same " potential  income and balance?


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## mathjak107 (Sep 10, 2018)

Ken N Tx said:


> My wife took the Spousal Award when I retired at 64..She gets the same Award without any increase when we turned 66.
> 
> Not sure if this might help..
> 
> SSA Calculator



the calculator can be a bit mis-leading .

as an example my wife is 2 years older than me . the calculator assumes that we both file together and she gets spousal when she files .  but in our case she filed early at 62 .  even though she is deemed to have filed for spousal too at that time the fact i delayed to 65  had her filing for spousal but not getting it .

when i filed at 65 she was 67 and now past fra so she actually got the higher amount based on being fra at the time spousal kicked in .   while she still kept her early benefit  , her spousal difference was not cut because she is fra .

if both file early then this chart applies and both have cuts .
 .
https://www.ssa.gov/oact/quickcalc/earlyretire.html


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## HipGnosis (Sep 10, 2018)

mathjak107 said:


> also another point i should mention is there is nothing inherent in delaying that automatically gives you more money to spend or a bigger balance for heirs compared to filing early  .you see this myth all the time posted , how waiting gives them more money . but that is not always true . the only time it is true is if you work and delay .


Please post your source.


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## mathjak107 (Sep 10, 2018)

famed researcher michael kitces worked up those charts showing how long it would take a balanced portfolio and social security to equal each other once the spending down of invested assets  while delaying is figured in to the equation and that money permanently gone forever from compounding.

since our incomes are made up of our ss check and what our portfolio's can produce  getting a bigger ss check at the expense of less in the portfolio compounding can work out  better either way depending whether markets or longevity do better.either one can surpass the other .


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## C'est Moi (Sep 10, 2018)

mathjak107 said:


> also another point i should mention is there is nothing inherent in delaying that automatically gives you more money to spend or a bigger balance for heirs compared to filing early  .you see this myth all the time posted , how waiting gives them more money . but that is not always true . the only time it is true is if you work and delay .
> ...



Agree.   Plus I am concerned that the geniuses in Congress will decide that SS needs to be means-tested, which will mean that people who scrimped and saved to have a comfortable retirement will see their SS benefit reduced if they have significant assets.   I am vehemently opposed to that because I paid my SS taxes in good faith with the expectation of a promised benefit.   

If I'd had any choice in the matter, I'd not have paid into the system but would have made my own investments with that SS tax.


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## mathjak107 (Sep 10, 2018)

ss is already means tested multiple ways . over a certain income you are double taxed on it . it is taxed when it goes in and taxed again when you get it .
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"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."

https://www.dallasnews.com/business...-that-social-security-is-already-means-tested


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## AZ Jim (Sep 10, 2018)

I have been on SS since I turned 65.  I am 82.  My advice is NEVER come on a internet seeking legal type advice.  First place I would go is "the horses mouth" (social Security Administration).  Too many have found out too late that the internet expert was WRONG...


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## mathjak107 (Sep 10, 2018)

they are the worst to ask . if it is not in the script they are not knowledgeable at all . do you really think these low level ss workers are people you should take advice from ?

 you see conflicting answers all the time from ss being given to people depending who they asked  . the best places are the specialist sites like social security solutions .  yeah , they charge but if you think the price of good advice is expensive , you can't afford free.

there is so much more to ss as you look at how it integrates in to your plan tax wise , rmd wise , income wise and how your investments fit in to the plan and co-ordinate with ss  .  these on line services do it all depending how much you want to pay for analyzation .

we were guinea pigs for fidelity's in house software optimizing social security .

while the software came up with the best combo to maximize dollars from ss for a couple it did not integrate it in to your total plan . fidelity realized this was a mistake and have pulled back the software from use because it is not comprehensive enough to really fit the bill.

social security does not even offer the level of  sophistication the fidelity software did .


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## JimW (Sep 11, 2018)

I would never use any gov't funded entity for financial advice. The people working in gov't usually know less about what they are doing than the average person does.


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## mathjak107 (Sep 11, 2018)

they are very limited in their scripting. in fact they gave me mis-information when i questioned the  special first year rules for working pre fra.

they also are not good at claiming strategies  and they have no provisions for giving you anything but straight line calculations .

as an example:

the fidelity optimizing ss software had come up with,   my wife who claimed at 62 was to stop her benefit at fra. she would let it grow. i would delay mine . when she hit 70 and took her ss again  i would be 68 . i would file for 1/2 hers  until i hit 70. at 70 i would file and she would get a spousal adder  to her benefit .  that would have maximized the claiming dollars . ss will never give you a breakout like that .


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## mathjak107 (Sep 12, 2018)

AZ Jim said:


> I have been on SS since I turned 65.  I am 82.  My advice is NEVER come on a internet seeking legal type advice.  First place I would go is "the horses mouth" (social Security Administration).  Too many have found out too late that the internet expert was WRONG...


optimizing ss is not "legal advice "  

the horses mouth is usually the worst choice for that . in fact i consider myself pretty well versed on optimizing  ss and i learned it all right in  the internet in forums .


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## StarSong (Sep 14, 2018)

We all have different levels of risk tolerance, financial acumen, savings, and family longevity.  Many things to consider and lots of advice to parse through.


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## mathjak107 (Sep 15, 2018)

yes , to many just look at ss from the perspective of what if i die ?  the real question is what if i  or my spouse live ?


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## mathjak107 (Sep 16, 2018)

AZ Jim said:


> I have been on SS since I turned 65.  I am 82.  My advice is NEVER come on a internet seeking legal type advice.  First place I would go is "the horses mouth" (social Security Administration).  Too many have found out too late that the internet expert was WRONG...


perfect example of why you don't count on ss for advice . many contributors on these kind of forums are far better educated in this stuff than those clerks you get on the lower levels .

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


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## StarSong (Sep 16, 2018)

I'm our family researcher so before making any decisions about Social Security I investigated the topic to death (and then some).   I had long discussion with friends and acquaintances who were also  doing heavy research, read numerous articles by authors with no agenda  besides a desire to be helpful, checked out information and calculators on expert  websites, and read several recently published books on the topic.  In  other words, I did my homework.  

For those not interested  in such a deep delve, at the very least you might want to  read the straightforward, "Get What's Yours - Revised and Updated: The Secrets to Maxing Out  Your Social Security" by Laurence Kotlikoff.  It's available through  Amazon and most public libraries.     

Mathjak, we agree that the wiser strategy for deciding when to start SS is to  consider what one's financial picture will be in the event of a long  life for either or both spouses, rather than what happens if both die  relatively early in retirement.      

There's nothing wrong with  soliciting advice from SS agents - but as part of a  smart retiree's research, not the beginning and end of it


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## mathjak107 (Sep 16, 2018)

laurence is about as knowledgeable as you can get . he is my go to guy for learning, mary beth franklin is another good source for learning on a simpler level  .


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## Don M. (Sep 16, 2018)

There is gobs of "advice" out there regarding SS.  Most of it seems to depend upon how long a person expects to live....which is like rolling dice.  Personally, I think most people wind up just as good...or better...by taking SS as soon as they become eligible.  Sure, you can get a bigger monthly payment by delaying signing up, but over the long run, delaying seems to have little effect on the final total, for most people.  Personally, I signed up as soon as I could, and same for my wife.  We've already received far more than I ever paid in while working....and if we live as long as our parents did, we will get 4 or 5 times what I paid in....my wife never worked outside the home.  Luckily, we have other good sources of income, so the SS is our "entertainment" money, and we save much of that.  I wonder how long it will be before the government "means tests" payments for folks like us....we are a prime example of why SS is slowly headed for a brick wall, unless the government raises the "caps", or takes some action soon to insure the future solvency of the program.


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## mathjak107 (Sep 16, 2018)

A lot of regret for filing early many times is when the survivor realizes that now precious ss check is slashed because of filing early . This come on top of not only losing an ss check but now having to file taxes as a single . Sometimes filing single can even get your ss taxed where as couple it wasn’t.

the cuts in survivor can be painful. So there are quite a lot of things to think about ,and they all have to do with living


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## Don M. (Sep 16, 2018)

mathjak107 said:


> So there are quite a lot of things to think about ,and they all have to do with living



If a person knew for sure how long they would live, the decision on when to take SS would be pretty easy.  However, since no one knows when their time is up, a "bird in hand" is probably the better choice for the majority.  Life expectancy for Males is hovering around 76 years....which, if using that as a base point, means about 6 years of larger payments, or 14 years of reduced benefits....my guess is that most wind up getting more by filing early.  Family longevity, general health, lifestyle habits, etc., etc., are all things that should be given careful consideration.


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## mathjak107 (Sep 17, 2018)

life expectancy is not 76 for males once you reach older ages like 65  . that is from birth which no longer applies . life expectancy is an average based on a cohort  where half are dead and half go on .. 

in fact it is far greater for couples since either can out live the other and you have two horses in the race with one bet . odds of one in a couple seeing 90 at age 65  is almost 50% .. odds of one in a couple seeing 85 is a whopping 73% .

for singles it is less . a single woman has a 54% chance of seeing 85 and a male is 42% . so these are a far cry from the 76 at birth .

the birth numbers are much lower because it includes lots of infant death and all the sickly ,weak and accident prone get weeded out .

so if a couple odds are very high one will see 85-90


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## mathjak107 (Sep 17, 2018)

if we compare the odds between taking ss early and not spending down a balanced portfolio and losing all future compounding on that money vs life expectancy risk   and delaying ss   we see the following odds .

to equal each other out , one in a couple needs to live to  90-95 . at 90 it is that point that the roi on ss is about a  5% real return and  those odds are 47%  , but to see 6%  real return ,  one in a couple has to live to 95    , those odds are just 19%

the odds of a balanced portfolio hitting 5.80  as an average real return (that is after inflation )  are 36% .

so there really is not a big difference in amounts at the end of the day between the two going by statistics as a couple .  taking ss early does have slightly better odds of leaving the bigger balance. so    it really amounts to are you more comfortable with more  market risk or more longevity risk ?

for a single the odds greatly  favor early ss and  staying invested .


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## StarSong (Sep 17, 2018)

Thanks for the charts and explanations, MJ.  All of my & my husband's parents lived into their nineties, and we each still have one living (and healthy!), so it's a reasonable bet that at least one of us will live to see 90.  Much better to have a single check at the _delayed until 70_ benefit rate than one from _taken at 62_.     

Given that the charts presume 5.8% growth on investments and my  very conservative portfolio yields roughly half that amount, you are offering yet  another good reason for us to delay SS.  

A point we're ignoring completely has to do with human nature, i.e., the discipline required to invest every dime from every SS check until age 70.  Despite the best of intentions most people will at least partially crumble when needs or wants arise and that nice little nest egg of SS checks is there for the taking.  (Most women over 35 won't purchase chocolate Halloween candy until a few days before the 31st and refuse to open the package until the holiday arrives.  Same principle.)


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## mathjak107 (Sep 17, 2018)

not everyone will have good longevity genes , not everyone will do well as an investor  so each has it's own set of risks .

but i think we all get the point that one inherently is not automatically going to provide more income or a bigger balance over a retirement . to many times you see  people think the bigger income will come from delaying ss but it is not inherently true . it is a question of more market risk or more longevity risk


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## C'est Moi (Sep 17, 2018)

As a retirement counselor once said, "tell me when you're going to die and I'll tell you the best financial decisions to make."   Most people will do what is comfortable to THEM; no one financial plan is best for everyone.


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## mathjak107 (Sep 17, 2018)

C'est Moi said:


> As a retirement counselor once said, "tell me when you're going to die and I'll tell you the best financial decisions to make."   Most people will do what is comfortable to THEM; no one financial plan is best for everyone.



another saying is those who delayed ss never lived to regret it .


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## StarSong (Sep 17, 2018)

mathjak107 said:


> another saying is those who delayed ss never lived to regret it .



LOL - I never heard that one but am going to borrow it now and then.   

If I don't live long enough to beat the SS odds, I'm ok with that.  I would rather have my money outlive me than the other way around.  Higher SS at age 70 and beyond is part of that plan.


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## mathjak107 (Sep 17, 2018)

StarSong said:


> LOL - I never heard that one but am going to borrow it now and then.
> 
> If I don't live long enough to beat the SS odds, I'm ok with that.  I would rather have my money outlive me than the other way around.  Higher SS at age 70 and beyond is part of that plan.


i agree with you , not being a more aggressive investor makes the  delayed ss a better deal .


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## AZ Jim (Sep 17, 2018)

Ken N Tx said:


> My wife took the Spousal Award when I retired at 64..She gets the same Award without any increase when we turned 66.
> 
> Not sure if this might help..
> 
> SSA Calculator


66!  So many years ago...


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## mathjak107 (Sep 18, 2018)

mathjak107 said:


> i agree with you , not being a more aggressive investor makes the  delayed ss a better deal .




according to research by michael kitces , even spending down assets to live while delaying that are in fixed income can take 20 years  to get even not counting spousal not received and uncapped medicare increases .. he looked at using tips , which are at least inflation adjusted and break even was 20 years later .

so at 62 you need to live to 82 to see a break even  and need to live longer to be able to say you have more money by delaying .  that spending down of assets to delay  always takes it's toll .. 

some try to rationalize it and say they are living off  a pension so they are not spending invested assets , but it is still the same thing because if they had the early ss it could be invested in either fixed income or equities  so either way it is still taking it's toll .


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## StarSong (Sep 18, 2018)

I"m having difficulty understand what point you're trying to make in the post above, MJ, so I went to your cited source's website for some clarity.  
https://www.kitces.com/blog/how-del...ong-term-investment-or-annuity-money-can-buy/

His advice tilts very strongly in favor of delaying benefits until age 70.


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## mathjak107 (Sep 18, 2018)

delaying is the best choice for most but the point is it is not a slam dunk when it comes to which allows you more money to spend and the bigger balance as most think  . kitces's  point is you can see the same return  from delaying if you live long enough or your spouse does to get the same return as a balanced portfolio  and the ss amounts to what is a gov't bond for that return . that is a great deal  .

but it takes a certain bet on your longevity to make that happen . other wise early ss and investing will be the winner . so it goes back to what i keep saying . do you want to be more longevity dependent or more market dependent ?

that is what delaying comes down  to . all things being equal being longevity dependent is the  least volatile road to the same results but you need to live long enough


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## HipGnosis (Sep 30, 2018)

StarSong said:


> I"m having difficulty understand what point you're trying to make in the post above, MJ, so I went to your cited source's website for some clarity.
> https://www.kitces.com/blog/how-del...ong-term-investment-or-annuity-money-can-buy/
> 
> His advice tilts very strongly in favor of delaying benefits until age 70.



Thank you for the synopsis


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