Social Security Retirement

[misskit]

If taking it at 62 and banking each monthly payment for 8 years in a high interest saving account (har har), is that amount less than the extra you would get from age 70, to say 80? (after which is there probably less need for extra money, if one is still awake)

Savings accounts are paying around 4% now.


Don’t think you will need less money when you are 80+. Chances are you will need a lot more money than now if you need someone to care for you.

Works out better particularly for women if you wait longer to get benefits.

[Topper]

^ Women tend to live longer

I turn 62 in June next year. I plan to start chatting with SSA after the first of the year to get everything arranged. My plan is to keep teaching and basically bank the SS for as long as I can. If I can make it to my late 60's I should be flush with enough savings.

[tomcat]

...I took SS as soon as I could (62) and have never regretted for a moment the decision...the cash is deposited in the States and I use it only for vacations there, to resupply my Kindle, for subscriptions and for income taxes...I carry to Thailand a large portion of the cash when it starts to accumulate and head over to Super Rich to exchange, thus saving the 3% BofA transfer fee and getting a better THB-USD rate than Bangkok Bank usually offers...

[Storekeeper]

Yes, I know about the spousal benefits but there is a caveat. The wife must have lived in the USA for several years. I can’t remember if it is 5 or 10 years. She can still get a one time payout for a widow without living in the US of A but it doesn’t amount but to a few hundred dollars. Even that will be withheld if the final SS check was cashed before the SS account holder dies.

Will have to research to verify but pretty sure the caveat (married for 10 and living in the states for 5) applies to green card holders vice US citizens.

[Edmond]

...I took SS as soon as I could (62) and have never regretted for a moment the decision...the cash is deposited in the States and I use it only for vacations there, to resupply my Kindle, for subscriptions and for income taxes

May be of news to some.

Those based in Thailand can get a TIN (Thai tax number - no work permit needed), get their pension, plus dividends/rental income/etc sent direct to Thailand, pay the Thai income tax on it, which makes it non-payable in their home countries (Thai tax is often less). Some countries accept it, some don't. Don't blame me if Yankee Doodle shows up to extradite you on tax evasion charges.

[Stumpy]

^ Check to see the difference between taking the payments at 62 versus waiting until later. If you wait until 70, you will have a much bigger payment each month.

You will still need to sign up for Medicare if there is any chance at all you will be needing it in the future.

Its an interesting question when to apply for SS MK. I have done numerous model scenarios calculating which way you "may" end up receiving the most financial benefits in ones lifetime. The unknown is our shelf life. Example, if you knew you were gonna check out at 70, then applying at 62 is a worthwhile idea. However lets say you live to 85. If you do not need the pension benefits it is far more financially fruitful to wait until 70. Each bump in years is a nice little monthly chunk of change.

The other variable in the model I generated was the benefit amount one receives at those ages 62.5, 66 or 70. Obviously some do not receive max benefits as it depends how much they contributed in their employment years. My scenarios were derived receiving max benefits. If you are going to use it to supplement your current income stream or if you have other retirement scenarios then apply at 62.5 being you are not living off it as primary income. Last I checked your SS is taxable up to 85% and if that is your only source of income, then filing a Tax return really isn't necessary anymore because your taxable amount is below the requirement. However if you have an IRA or a Roth etc you have to start taking distributions at 73. So that combined with your SS becomes combined income and you may owe a few bucks on taxes. Uncle Sammy boy wants his money and has his hand in our pockets constantly.

As for where to have the funds deposited, I will use a similar scenario as Tomcat. I have kept an active permanent residence in California and a few bank accts which my wife and I are joint owners. I will apply and just have it deposited there to keep it simple then annually roll it in to a CD or something like that. I am on the fence about Medicare. Guess a lot will depend when I get there, what my wife and I plans are etc.

[malmomike77]

Life pasr 60 is an actuarial game.

[Stumpy]

Life pasr 60 is an actuarial game.

That it is Toots. That it is. Its just another form of gambling as I see it. Some say, take the money and run, others say wait it out. I think in the big picture, it all really depends on the individuals life and health.

So as they say....Spin the wheel.........

[malmomike77]

^ Indeed. My plans don't include the UK Govt pension at late 60s @ c11k Gbp currently. If I get there its nice bonus. I have some investments which are rainy day and provide some annual return but most is out of two pensions. One I'll take pre 60 actuarially reduced and one somewhere between then and 65ish.

You are right ref projections, there is a steep return curve in play from late 60s on but as mentioned that is the game.

With a father that died of heart related issues and a mother who died of pancreatic cancer at 76 I'm looking at anything post 70 as a bonus and basing my drawdowns thus.

Of course it's not just about life expectancy but also about quality of life in our golden years and I have always inwardly maintained that I want to enjoy some of my ill gotten boomer gains before I'm confined to quarters.

[Stumpy]

My plans don't include the UK Govt pension at late 60s @ c11k Gbp currently. If I get there its nice bonus.

Same here. When I apply, it was always planned to be a "Bonus"

there is a steep return curve in play from late 60s on but as mentioned that is the game.

Of course it's not just about life expectancy but also about quality of life in our golden years and I have always inwardly maintained that I want to enjoy some of my ill gotten boomer gains before I'm confined to quarters.

That really is what it boils down to. The quality of life means everything. Who cares if you draw a nice pension if you are bed ridden. I will not apply for SS when I can due to the tax implications. It would just complicate it all for me. I am still working anyway.

[Storekeeper]

After reading all the comments I’m reminded I have one bug in my plan that might make me delay social security for a full year until 2025. It’s a TSP plan that is like a 401K and the plan is to cash it out. You guys have me thinking now that will cause my SS to be taxed to the max for the year I cash it out.

By the way just a rough number but the average age at death for both my sets of grandparents and their total 17 kids is 75. My Dad was the earliest to pass out of all of them at 58. Only one out of the total made it to 90. So I’m hoping for 75 and anything over that is a bonus.

So far my current income is more than enough to live comfortably in Thailand but not really letting that factor determine when I take SS. Haven’t even decided yet if I’ll have it deposited to my Bangkok Bank account or credit union in the states. As it stands we make about 5 large ATM withdrawals a month and don’t even really put a lot of thought into the ATM fees. Yeah, I know I should.

And the wife is covered … she’ll get roughly 25% of my retired Navy pension, 50% of my retired federal pension and the social security widow’s pension which I think is roughly 50% of whatever I’m drawing. And all of those will increase annually as long as there is a federal COLA.

Putting a lot of thought into one other possible income stream. Unfortunately it’ll require me to become a sickbay commando for a period of time to get the documentation.

My Navy pension doesn’t count against social security for income purposes and the federal pension isn’t big enough to make any difference.

Really the only favorable argument for me to delay social security is to guarantee my wife a larger amount on the widow’s benefit. Nah, I feel like I’ve done enough and she agrees.

[mudcat]

One's spouse can receive two different benefits:
Spousal benefit at 62-years old if the wage earner is still alive tops out at 50% of the wage earner's benefit and is reduced by taking it earlier than their full retirement age.
Survivor benefit @60-years is much more important as support as it is based on the worker's full retirement amount (FRA) even if the worker took Social Security early (as I did). Her benefit is limited to 82.5% of the worker's FRA (AKA widows limit). The upshot is shoud I pass tomorrow in seven years when she turns 60 my wife would receive an inflation adjusted pension of ~55,000 ThB per month even though she never worked in the U.S. A remarriage before 60 wipes out her eligibility

I will continue to pay Medicare part B as should I need to or choose to return after living overseas I would not not need to wait until the annual open enrollment but could enroll in a medigap or Advantage plan immediately. I look on Medicare as government re-insurance.

[Storekeeper]

Learn something new every day. This applies to veterans here who are married to a Thai and don’t meet the 5 year residency requirement in the states:

* If when you pass away while on active duty, or your death is determined to be service connected.
* Or if you were rated 100% totally disabled for 10 years or longer.

https://www.ssa.gov/pubs/EN-05-10137.pdf

So, if a veteran’s wife is eligible for Dependent Indemnity Compensation from the VA then it’s highly likely she’s eligible for social security widow’s benefits.

About VA DIC For Spouses, Dependents, And Parents | Veterans Affairs