Got an S.S. question, please?

[Tractor Seabee]

" I now have 6 retirement annuities (4 are indexed to inflation) paying off with a 6 figure + income, money in the bank, and good equity in my home. 82 and still collecting and living it up."

Wow, you are very well set and very very smart with your investments. I do think too many wait too long and just try to "get by" over the years. I have known a few people that had a big house/corvettes in the driveway and could not rub two nickles together. One of my favorite stories that goes the other way is about the old farmer that went to buy a new truck and because he was in overalls/worn boots and unshaven....no one wanted to help me. They didn't think he had any money. Finally one of the guys went out to help him and he pointed and said that one, at a truck. Sales guy, sort of embarrassingly, asked him how he wants to pay for it. He pulls a roll of hundreds out that would choke a horse and says, This! Shows you never know who the guy is that dresses a little shabbily and runs a big operation.

I heard another wrinkle to that story: "Dealer sales manager says "sorry we have no way to handle that much cash, please go to the bank and get a cashiers check." The old farmer says "I am also sorry, I just got paid off by the Co-Op for my wheat crop, you just lost a sale" and walked out.

Ron

 

[fishheadbob]

"The down side of taking the reduced retirement at 62. At 65 you can make all you want."

Could someone explain what the reasoning is behind this?

At 66, not at 65. The age for full retirement benefits is 66, before that your monthly benefit is reduced for your age, and work can cause you to lose some or all of your benefit.
The reason behind it is why it's called "The retirement test". You have to be all or pretty much retired to collect. Someone called SS benefits an annuity earlier and I cringed a little bit. An annuity doesn't care how much you make when collecting, but if you're under full retirement age SS looks at your work. You might not agree with that concept, but it is unfortunately the law.

How did I feel about 600 pound people collecting disability ? They didn't qualify because they looked like the fat man at the carnival but because by the time they hit 5 or 6 hundred pounds they had bad diabetes, blown out hips or knees, arthritis, usually heart disease, and who knows what else. They qualified medically with that list of impairments even if it was self induced. But so were heavy cigarette smokers, they weren't disqualified because they brought lung cancer or heart disease on themselves.
I personally was never big on the stinkers. People who would bathe every few years whether they needed to or not. There's a lot of crazy people out there and we got them all. Fact is we got everybody, think the good the bad and the ugly. We got paid to handle whatever their issue was, not start fighting with them, and move on to the next person. We didn't get paid to fight with them, that just made our day longer.

 

[lennyzx11]

After reading this, I realized I hadn't been paying too much attention to drawing SS in the future. I am turning 55 this year.

Social Security Strategies for Married Couples

But can someone clarify one point in the article?

Under the paragraph titled Restricted application, the higher earner can draw off the lower earner's benefits as a spouse. Until his full retirement age of 70.
But. In the next paragraph it states that to qualify, the higher earner has to be full retirement age.
So. I have to be 70 in order to draw spousal benefits on my wife's lower earners until I'm 70! <laughing>
Surely, I've got something wrong.

I have a fairly high income. And wife hasn't worked for about 10 years so hers is low but she's returning to work next year.
We are both 55 this year and this looked like a strategy worth pursuing.
Thank you,

 

[two_bit_score]

I spent 28 years with Social Security explaining this jibberish to people. mddorange nailed it.

So, please, if one retires from a wages job at 62 and does not start collecting SS until 66 would the intervening years of no wages into SS penalize them?

 

[fishheadbob]

After reading this, I realized I hadn't been paying too much attention to drawing SS in the future. I am turning 55 this year.

Social Security Strategies for Married Couples

But can someone clarify one point in the article?

Under the paragraph titled Restricted application, the higher earner can draw off the lower earner's benefits as a spouse. Until his full retirement age of 70.
But. In the next paragraph it states that to qualify, the higher earner has to be full retirement age.
So. I have to be 70 in order to draw spousal benefits on my wife's lower earners until I'm 70! <laughing>
Surely, I've got something wrong.

I have a fairly high income. And wife hasn't worked for about 10 years so hers is low but she's returning to work next year.
We are both 55 this year and this looked like a strategy worth pursuing.
Thank you,

That might have been tightened up, I am not sure. You could try calling the 800 number but you'd probably be better off asking the 800 number people then scheduling an in office appointment. The 800 # agents can be hit or miss; be prepared for a lengthy wait and have something to read.

 

[fishheadbob]

So, please, if one retires from a wages job at 62 and does not start collecting SS until 66 would the intervening years of no wages into SS penalize them?

Yes and no. You likely have 35 solid years of earnings so that's covered but you're also at the top of your game and making more than you did as a youngster. It's not a mammoth difference, but it is a difference.

When I talk about SS i sure have to use the word "but" an awful lot.

 

[smstonypoint]

When I talk about SS i sure have to use the word "but" an awful lot.

And when I talk about economics, I use the term "it depends" a lot.

Steve

 

[QRTRHRS]

No. Pension income is exempt.

Yes as far as earnings against SS are concerned. My wife and I both have SS and pensions coming in. It looks great until the federal tax is accounted for.

 

[Tractor Seabee]

Yes and no. You likely have 35 solid years of earnings so that's covered but you're also at the top of your game and making more than you did as a youngster. It's not a mammoth difference, but it is a difference.

When I talk about SS i sure have to use the word "but" an awful lot.

When you get the 35 years banked; working years after that get re-computed each year on the 35 highest yearning years. All those low years way back drop out of the averaging which then increases your. Knocking out those low years with wages 3 times higher or more can be lucrative. There are a lot of nuances that often get left out of discussions through those little windows. For a long time that 35 year averaging never was seemingly a big secret.

Ron
Ron

 

[DrRod]

I heard another wrinkle to that story: "Dealer sales manager says "sorry we have no way to handle that much cash, please go to the bank and get a cashiers check." The old farmer says "I am also sorry, I just got paid off by the Co-Op for my wheat crop, you just lost a sale" and walked out.

Ron

My father told me a similar story to teach a lesson. He was a car dealer and a guy walked in wearing coveralls covered in smelly saw dust [i.e. poultry litter]. he walked around the showroom and settled down next to the Imperial, Chrysler's most expensive luxury car. My father walked over to him and he said "how much is this?" He told him and then the guy said "how much for two?" He and his brother came back the next day and bought a pair of them. Turned out they were the biggest turkey producers in the area and expanded to regional coverage -- to this day you can see their tractor trailers all over the Interstate.

I was 16 and working around the dealership and so a few days later I went out to move their trade-ins -- a couple of Chevy's. When I opened the door [hot day] every fly in the county rushed to that car. It was so bad that one of the mechanics asked if I wanted him to move it, he said "I wouldn't blame you if you didn't want to get in that car." But I did it and we took it straight to the scrap yard.