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Personal Finance Advice and Education! (2 Viewers)

OK, this is probably covered elsewhere, but I'm looking for a good way to manage my multiple bank accounts these days, which now cover multiple currencies. I suppose it's only 2 institutions, but something like 7 total accounts, checking and savings. I could do it weekly on a spreadsheet, just tracking balances and the like, but I was wondering if there was an inexpensive software platform that could do it better than an Excel spreadsheet.

I don't really need any investment / brokerage tracking as I don't have many of those and I just manually rebalance them every 12 months anyway.
 
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Crazy stat I just heard. In 1935, when social security was established, it had 150 workers paying in for each retiree. By 1950, it dropped to 16 to 1. Today it’s 2.3 to 1. Wow.
That just seems impossible. But not too far off. Close to 4:1. From ChatGPT

In 2025, the United States population is estimated at approximately 347.3 million people. Here's the general age demographic breakdown:

- **Young population (under 18):** 59.4 million, or 17.1% of the total population.
- **Working-age population (18–64):** 224 million, making up 64.5%.
- **Elderly population (65 and older):** 63.9 million, accounting for 18.4% [oai_citation:2,United States Population by State and City 2025 - Statistics and Trends](https://nchstats.com/us-population/) [oai_citation:1,Population Pyramid of United States of America at 2025 - Population Pyramids](https://population-pyramid.net/en/pp/united-states-of-america).
 
Crazy stat I just heard. In 1935, when social security was established, it had 150 workers paying in for each retiree. By 1950, it dropped to 16 to 1. Today it’s 2.3 to 1. Wow.
That just seems impossible. But not too far off. Close to 4:1. From ChatGPT

In 2025, the United States population is estimated at approximately 347.3 million people. Here's the general age demographic breakdown:

- **Young population (under 18):** 59.4 million, or 17.1% of the total population.
- **Working-age population (18–64):** 224 million, making up 64.5%.
- **Elderly population (65 and older):** 63.9 million, accounting for 18.4% [oai_citation:2,United States Population by State and City 2025 - Statistics and Trends](https://nchstats.com/us-population/) [oai_citation:1,Population Pyramid of United States of America at 2025 - Population Pyramids](https://population-pyramid.net/en/pp/united-states-of-america).
Yeah but how much of the "young" and the "working age" buckets are actually working? 2:1 is believable.
 
Crazy stat I just heard. In 1935, when social security was established, it had 150 workers paying in for each retiree. By 1950, it dropped to 16 to 1. Today it’s 2.3 to 1. Wow.
That just seems impossible. But not too far off. Close to 4:1. From ChatGPT

In 2025, the United States population is estimated at approximately 347.3 million people. Here's the general age demographic breakdown:

- **Young population (under 18):** 59.4 million, or 17.1% of the total population.
- **Working-age population (18–64):** 224 million, making up 64.5%.
- **Elderly population (65 and older):** 63.9 million, accounting for 18.4% [oai_citation:2,United States Population by State and City 2025 - Statistics and Trends](https://nchstats.com/us-population/) [oai_citation:1,Population Pyramid of United States of America at 2025 - Population Pyramids](https://population-pyramid.net/en/pp/united-states-of-america).

As mentioned above, how many of the first two groups are working? And in that final group, there may be folks delaying enrollment (full age is 67 now) and can be delayed till 70, right?
 
Tax forms starting to come in. About time to figure out if I'm in a safe harbor or not. 🚣‍♂️
I could use some help with this. I think I need to pay some ahead of time for 2025. You have a cheat sheet/list of pointers? Is it as simple as calculating total tax for 2024 and then making sure you've paid at least that much for 2025?
It depends on your AGI and filing status. If your AGI/filing status are above certain thresholds, you need to pay-in 110% of your 2024 tax liability as estimates for 2025. If you're below the thresholds, it's 100%. You also need to make sure 1/4 of whatever your obligation is, is paid by the quarterly installment due dates - i.e. you can't pay the entire amount on like 12/31/2025 and apply it retroactively to the entire year.
Not an accountant, but isn't it this 110% of prior year OR 90% of current year?
Yes, but when I read your comment saying "safe harbor", I read it to mean what we normally call a "protective" estimate. If his goal is to guarantee no underpayment penalty for 2025, regardless of what his 2025 income is, the "protective" estimate is the way to do it. Your income could 10x, and as long as you paid in 100% (or 110% as applicable) of your 2024 liability in equal quarterly installments in 2025, there would be no underpayment penalty even if you owe millions of dollars on 4/15/2026.

I am actually in a situation where our 2024 income will be lower than our 2023 income. I did not expect that to be an issue as, in April of 24, I quit my job and my wife increased her withholdings. Because roughly half of my compensation YTD was withheld at the top rate, figured we would be pretty good. Turns out, I made $12K in what I'm filing as a gambling business and got hired at a slightly higher salary in June at another firm. I figured that increasing the 401k up to the max would get us in a pretty safe situation. Unfortunately, my wife messed up the math and came up a few grand short. Looks pretty close with my estimates prior to year end.

So that is what I was trying to refer to there :-)
 
Crazy stat I just heard. In 1935, when social security was established, it had 150 workers paying in for each retiree. By 1950, it dropped to 16 to 1. Today it’s 2.3 to 1. Wow.
That just seems impossible. But not too far off. Close to 4:1. From ChatGPT

In 2025, the United States population is estimated at approximately 347.3 million people. Here's the general age demographic breakdown:

- **Young population (under 18):** 59.4 million, or 17.1% of the total population.
- **Working-age population (18–64):** 224 million, making up 64.5%.
- **Elderly population (65 and older):** 63.9 million, accounting for 18.4% [oai_citation:2,United States Population by State and City 2025 - Statistics and Trends](https://nchstats.com/us-population/) [oai_citation:1,Population Pyramid of United States of America at 2025 - Population Pyramids](https://population-pyramid.net/en/pp/united-states-of-america).
Yeah but how much of the "young" and the "working age" buckets are actually working? 2:1 is believable.

According to SSA, 71.6M people currently receive SSA benefits (including more than 7M on SS disability). According to this link, 161.2M people were employed as of Dec 2024. That is 2.25 to 1.
 
Tax forms starting to come in. About time to figure out if I'm in a safe harbor or not. 🚣‍♂️
I could use some help with this. I think I need to pay some ahead of time for 2025. You have a cheat sheet/list of pointers? Is it as simple as calculating total tax for 2024 and then making sure you've paid at least that much for 2025?
It depends on your AGI and filing status. If your AGI/filing status are above certain thresholds, you need to pay-in 110% of your 2024 tax liability as estimates for 2025. If you're below the thresholds, it's 100%. You also need to make sure 1/4 of whatever your obligation is, is paid by the quarterly installment due dates - i.e. you can't pay the entire amount on like 12/31/2025 and apply it retroactively to the entire year.
Not an accountant, but isn't it this 110% of prior year OR 90% of current year?

And isn't there an exception the quarterly payment requirement if you pay via withholdings (on an IRA distribution, for example)?
Withholdings are treated as if they were paid ratably throughout the year, regardless of when they are actually paid. So yes, withholding on a Q4 payment would be considered to have been paid ratably across all 4 quarters, for underpayment penalty calc purposes.

⚫

For large distributions you can skip the penalty, manually do it if turbo tax says you owe, as long as it doesn't happen two years consecutively right? That's what I've always done in the past. I have to do it for 2025 because it will be consecutive with 2024 so appreciate the rules of thumb. Thanks.
 
Didn't really want to start an entire new thread for this and it seems like something that fits well enough here...for us 50+ people...what are the actual benefits of an AARP membership? Anything worthwhile (and for $16/year, I realize it wouldn't take much to be worth it)?
 
Crazy stat I just heard. In 1935, when social security was established, it had 150 workers paying in for each retiree. By 1950, it dropped to 16 to 1. Today it’s 2.3 to 1. Wow.
That just seems impossible. But not too far off. Close to 4:1. From ChatGPT

In 2025, the United States population is estimated at approximately 347.3 million people. Here's the general age demographic breakdown:

- **Young population (under 18):** 59.4 million, or 17.1% of the total population.
- **Working-age population (18–64):** 224 million, making up 64.5%.
- **Elderly population (65 and older):** 63.9 million, accounting for 18.4% [oai_citation:2,United States Population by State and City 2025 - Statistics and Trends](https://nchstats.com/us-population/) [oai_citation:1,Population Pyramid of United States of America at 2025 - Population Pyramids](https://population-pyramid.net/en/pp/united-states-of-america).
Yeah but how much of the "young" and the "working age" buckets are actually working? 2:1 is believable.

According to SSA, 71.6M people currently receive SSA benefits (including more than 7M on SS disability). According to this link, 161.2M people were employed as of Dec 2024. That is 2.25 to 1.

Damn that’s scary. This whole birthrate dropping thing has large impacts, and this is one of them. Given the trend that I posted above that we’ve seen, is it projected to get worse?
 
Crazy stat I just heard. In 1935, when social security was established, it had 150 workers paying in for each retiree. By 1950, it dropped to 16 to 1. Today it’s 2.3 to 1. Wow.
That just seems impossible. But not too far off. Close to 4:1. From ChatGPT

In 2025, the United States population is estimated at approximately 347.3 million people. Here's the general age demographic breakdown:

- **Young population (under 18):** 59.4 million, or 17.1% of the total population.
- **Working-age population (18–64):** 224 million, making up 64.5%.
- **Elderly population (65 and older):** 63.9 million, accounting for 18.4% [oai_citation:2,United States Population by State and City 2025 - Statistics and Trends](https://nchstats.com/us-population/) [oai_citation:1,Population Pyramid of United States of America at 2025 - Population Pyramids](https://population-pyramid.net/en/pp/united-states-of-america).
Yeah but how much of the "young" and the "working age" buckets are actually working? 2:1 is believable.

According to SSA, 71.6M people currently receive SSA benefits (including more than 7M on SS disability). According to this link, 161.2M people were employed as of Dec 2024. That is 2.25 to 1.

Damn that’s scary. This whole birthrate dropping thing has large impacts, and this is one of them. Given the trend that I posted above that we’ve seen, is it projected to get worse?
I think the changing demographics are already figured in to the projections.
What wasn’t was the elimination of WEP and GPO which just hacked another six months off of the projected timelines of the trust being depleted. Various sources have the date somewhere between 2033-35.
Since that is well before I’ll be able to claim, I continue to use 75% of my projected benefits in my planning.
 
Crazy stat I just heard. In 1935, when social security was established, it had 150 workers paying in for each retiree. By 1950, it dropped to 16 to 1. Today it’s 2.3 to 1. Wow.
That just seems impossible. But not too far off. Close to 4:1. From ChatGPT

In 2025, the United States population is estimated at approximately 347.3 million people. Here's the general age demographic breakdown:

- **Young population (under 18):** 59.4 million, or 17.1% of the total population.
- **Working-age population (18–64):** 224 million, making up 64.5%.
- **Elderly population (65 and older):** 63.9 million, accounting for 18.4% [oai_citation:2,United States Population by State and City 2025 - Statistics and Trends](https://nchstats.com/us-population/) [oai_citation:1,Population Pyramid of United States of America at 2025 - Population Pyramids](https://population-pyramid.net/en/pp/united-states-of-america).
Yeah but how much of the "young" and the "working age" buckets are actually working? 2:1 is believable.

According to SSA, 71.6M people currently receive SSA benefits (including more than 7M on SS disability). According to this link, 161.2M people were employed as of Dec 2024. That is 2.25 to 1.

Damn that’s scary. This whole birthrate dropping thing has large impacts, and this is one of them. Given the trend that I posted above that we’ve seen, is it projected to get worse?
I think the changing demographics are already figured in to the projections.
What wasn’t was the elimination of WEP and GPO which just hacked another six months off of the projected timelines of the trust being depleted. Various sources have the date somewhere between 2033-35.
Since that is well before I’ll be able to claim, I continue to use 75% of my projected benefits in my planning.
The debt is irrelevant. They'll just print more money! We'll be fine!
 
Crazy stat I just heard. In 1935, when social security was established, it had 150 workers paying in for each retiree. By 1950, it dropped to 16 to 1. Today it’s 2.3 to 1. Wow.
That just seems impossible. But not too far off. Close to 4:1. From ChatGPT

In 2025, the United States population is estimated at approximately 347.3 million people. Here's the general age demographic breakdown:

- **Young population (under 18):** 59.4 million, or 17.1% of the total population.
- **Working-age population (18–64):** 224 million, making up 64.5%.
- **Elderly population (65 and older):** 63.9 million, accounting for 18.4% [oai_citation:2,United States Population by State and City 2025 - Statistics and Trends](https://nchstats.com/us-population/) [oai_citation:1,Population Pyramid of United States of America at 2025 - Population Pyramids](https://population-pyramid.net/en/pp/united-states-of-america).
Yeah but how much of the "young" and the "working age" buckets are actually working? 2:1 is believable.

According to SSA, 71.6M people currently receive SSA benefits (including more than 7M on SS disability). According to this link, 161.2M people were employed as of Dec 2024. That is 2.25 to 1.

Damn that’s scary. This whole birthrate dropping thing has large impacts, and this is one of them. Given the trend that I posted above that we’ve seen, is it projected to get worse?
I think the changing demographics are already figured in to the projections.
What wasn’t was the elimination of WEP and GPO which just hacked another six months off of the projected timelines of the trust being depleted. Various sources have the date somewhere between 2033-35.
Since that is well before I’ll be able to claim, I continue to use 75% of my projected benefits in my planning.
The debt is irrelevant. They'll just print more money! We'll be fine!
Different topic altogether.
 
Since that is well before I’ll be able to claim, I continue to use 75% of my projected benefits in my planning.

Has this thread discussed pros and cons of when to start taking SS benefits? I tried to search but couldn't find it. This issue you commented on would seem to be at least a small reason to start sooner.

Last time I got my annual statement, I determined that:
  • If I wait until age 67 to start benefits, it will take me until age 77 to surpass the money that would be paid out to me if I started at age 62.
  • If I wait until age 70 to start benefits, it will take me until age 79 to surpass the money that would be paid out to me if I started at age 62.
  • If I wait until age 70 to start benefits, it will take me until age 81 to surpass the money that would be paid out to me if I started at age 67.
All of this was simple analysis that ignored the possibility of earning money through investing if I start earlier and ignored tax implications, such as potentially being in a higher tax bracket if I start earlier. But it led me to conclude I should start at age 62 when the time comes. I don't know of any reason why I wouldn't live to age 79 or 81, but I certainly don't view it as a guarantee.

This possibility that benefits get reduced, or the possibility that means testing will be incorporated in some way just adds to that perspective. Thoughts on this?
 
Since that is well before I’ll be able to claim, I continue to use 75% of my projected benefits in my planning.

Has this thread discussed pros and cons of when to start taking SS benefits? I tried to search but couldn't find it. This issue you commented on would seem to be at least a small reason to start sooner.

Last time I got my annual statement, I determined that:
  • If I wait until age 67 to start benefits, it will take me until age 77 to surpass the money that would be paid out to me if I started at age 62.
  • If I wait until age 70 to start benefits, it will take me until age 79 to surpass the money that would be paid out to me if I started at age 62.
  • If I wait until age 70 to start benefits, it will take me until age 81 to surpass the money that would be paid out to me if I started at age 67.
All of this was simple analysis that ignored the possibility of earning money through investing if I start earlier and ignored tax implications, such as potentially being in a higher tax bracket if I start earlier. But it led me to conclude I should start at age 62 when the time comes. I don't know of any reason why I wouldn't live to age 79 or 81, but I certainly don't view it as a guarantee.

This possibility that benefits get reduced, or the possibility that means testing will be incorporated in some way just adds to that perspective. Thoughts on this?
Considering:

1) SS has the potential to diminish or worst as more time passes
2) There's no guarantee how long I'll live
3) I can invest it and potentially do better or, at worst, not break even for a LONG time when I won't care

I'll be taking day 1 when I turn 62 barring anything crazy that changes before then.
 
Since that is well before I’ll be able to claim, I continue to use 75% of my projected benefits in my planning.

Has this thread discussed pros and cons of when to start taking SS benefits? I tried to search but couldn't find it. This issue you commented on would seem to be at least a small reason to start sooner.

Last time I got my annual statement, I determined that:
  • If I wait until age 67 to start benefits, it will take me until age 77 to surpass the money that would be paid out to me if I started at age 62.
  • If I wait until age 70 to start benefits, it will take me until age 79 to surpass the money that would be paid out to me if I started at age 62.
  • If I wait until age 70 to start benefits, it will take me until age 81 to surpass the money that would be paid out to me if I started at age 67.
All of this was simple analysis that ignored the possibility of earning money through investing if I start earlier and ignored tax implications, such as potentially being in a higher tax bracket if I start earlier. But it led me to conclude I should start at age 62 when the time comes. I don't know of any reason why I wouldn't live to age 79 or 81, but I certainly don't view it as a guarantee.

This possibility that benefits get reduced, or the possibility that means testing will be incorporated in some way just adds to that perspective. Thoughts on this?
Considering:

1) SS has the potential to diminish or worst as more time passes
2) There's no guarantee how long I'll live
3) I can invest it and potentially do better or, at worst, not break even for a LONG time when I won't care

I'll be taking day 1 when I turn 62 barring anything crazy that changes before then.
I agree on taking at 62 which is what I did. Also agree with all the points you listed here as well as Tau837's comment on waiting until 70 means the breakeven age is 79 (not taking into account investments made which in my mind pushes it out even further)).
 
Since that is well before I’ll be able to claim, I continue to use 75% of my projected benefits in my planning.

Has this thread discussed pros and cons of when to start taking SS benefits? I tried to search but couldn't find it. This issue you commented on would seem to be at least a small reason to start sooner.

Last time I got my annual statement, I determined that:
  • If I wait until age 67 to start benefits, it will take me until age 77 to surpass the money that would be paid out to me if I started at age 62.
  • If I wait until age 70 to start benefits, it will take me until age 79 to surpass the money that would be paid out to me if I started at age 62.
  • If I wait until age 70 to start benefits, it will take me until age 81 to surpass the money that would be paid out to me if I started at age 67.
All of this was simple analysis that ignored the possibility of earning money through investing if I start earlier and ignored tax implications, such as potentially being in a higher tax bracket if I start earlier. But it led me to conclude I should start at age 62 when the time comes. I don't know of any reason why I wouldn't live to age 79 or 81, but I certainly don't view it as a guarantee.

This possibility that benefits get reduced, or the possibility that means testing will be incorporated in some way just adds to that perspective. Thoughts on this?
Considering:

1) SS has the potential to diminish or worst as more time passes
2) There's no guarantee how long I'll live
3) I can invest it and potentially do better or, at worst, not break even for a LONG time when I won't care

I'll be taking day 1 when I turn 62 barring anything crazy that changes before then.
I agree on taking at 62 which is what I did. Also agree with all the points you listed here as well as Tau837's comment on waiting until 70 means the breakeven age is 79 (not taking into account investments made which in my mind pushes it out even further)).

You two are reinforcing what I thought, whereas I thought I had understood previously that advisers would often recommend waiting. Maybe I remember that wrong, or maybe things have changed.
 
It’s a lot more than just a simple break even analysis for most people. For example two player mode complicates things a bit, particularly if one spouse’s benefit is significantly higher than the others. Most analysis I’ve seen in that scenario suggests the lower benefit spouse take theirs early, possibly even at 62, and the other wait until 70. The lower benefit spouse then switches to half of the other. That also maximizes the survivor benefit if the higher earning spouse passes first.

In general most “experts” seem to recommend waiting until at least full retirement age. Claiming at 62 lowers your benefit amount like 30%. Forever. And all future COLA adjustments are also based on this 30% lower amount, literally compounding the effect even more. Forever.

There are other considerations.
Claiming early may inhibit your ability to do Roth conversions.
It may make it less tax efficient to pull money out of a standard brokerage account (higher dividend or capital gains rates).
SS is tax advantaged compared to traditional IRA withdrawals since at most 80% is taxed, so getting a higher percentage of your income from that can lower tax liabilities.
If you’re still working when you claim that may reduce your benefits.
More of your income coming from SS in your 60s instead of pulling traditional IRAs will ultimately lead to higher RMDs (and taxes, for both buckets).

Lots to consider.
 
It’s a lot more than just a simple break even analysis for most people. For example two player mode complicates things a bit, particularly if one spouse’s benefit is significantly higher than the others. Most analysis I’ve seen in that scenario suggests the lower benefit spouse take theirs early, possibly even at 62, and the other wait until 70. The lower benefit spouse then switches to half of the other. That also maximizes the survivor benefit if the higher earning spouse passes first.

In general most “experts” seem to recommend waiting until at least full retirement age. Claiming at 62 lowers your benefit amount like 30%. Forever. And all future COLA adjustments are also based on this 30% lower amount, literally compounding the effect even more. Forever.

There are other considerations.
Claiming early may inhibit your ability to do Roth conversions.
It may make it less tax efficient to pull money out of a standard brokerage account (higher dividend or capital gains rates).
SS is tax advantaged compared to traditional IRA withdrawals since at most 80% is taxed, so getting a higher percentage of your income from that can lower tax liabilities.
If you’re still working when you claim that may reduce your benefits.
More of your income coming from SS in your 60s instead of pulling traditional IRAs will ultimately lead to higher RMDs (and taxes, for both buckets).

Lots to consider.
Agreed it is very complicated trying to factor in everything including taxes now and the future. One thing I do expect is social security payouts likely to get worse in the future so want to maximize the money we get from it now.
 
I financially plan on living until 100 so easy decision to postpone as long as they're giving me that guaranteed 8% increase each year that will also benefit from the inflation adjustments.

I expect there are plenty of people who plan to live to 100, or 90, or 80… and don’t.
 
Obviously it's unique to everyone's situation, but generally speaking, it's probably a mistake to claim before full retirement age. There are really only a few specific instances where it makes sense to take it early.
It would be great if you would explain why you say this.
 
Obviously it's unique to everyone's situation, but generally speaking, it's probably a mistake to claim before full retirement age. There are really only a few specific instances where it makes sense to take it early.
You are probably right it’s best to wait but in our case I considered the following:

My social security income and wife’s are going to be about equal so no need to wait for the survivor benefit to grow
Social security is going to be reduced at some point to survive. Want to get what I can now.
It is almost impossible trying to sort out what is best for tax purposes since that is constantly changing. However knowing I could invest that money now my break even point if taking at 62 vs 70 possibly pushes it into my mid 80s

Again I realize I could be totally in the wrong. For us social security income is a luxury vs. something we are counting on so perhaps that has affected how I approach it vs how I might approach it.
 
It’s a lot more than just a simple break even analysis for most people. For example two player mode complicates things a bit, particularly if one spouse’s benefit is significantly higher than the others. Most analysis I’ve seen in that scenario suggests the lower benefit spouse take theirs early, possibly even at 62, and the other wait until 70. The lower benefit spouse then switches to half of the other. That also maximizes the survivor benefit if the higher earning spouse passes first.

In general most “experts” seem to recommend waiting until at least full retirement age. Claiming at 62 lowers your benefit amount like 30%. Forever. And all future COLA adjustments are also based on this 30% lower amount, literally compounding the effect even more. Forever.

There are other considerations.
Claiming early may inhibit your ability to do Roth conversions.
It may make it less tax efficient to pull money out of a standard brokerage account (higher dividend or capital gains rates).
SS is tax advantaged compared to traditional IRA withdrawals since at most 80% is taxed, so getting a higher percentage of your income from that can lower tax liabilities.
If you’re still working when you claim that may reduce your benefits.
More of your income coming from SS in your 60s instead of pulling traditional IRAs will ultimately lead to higher RMDs (and taxes, for both buckets).

Lots to consider.
Can you explain the bolded?
 
Hypothetical question to the group….

Say you were in your late 40’s or early 50’s and you won a million (take home) in the lotto. How would you invest/use/whatever that money.*

*for the sake of the exercise let’s assume you already spent all you need on hookers and blow.
 
Obviously it's unique to everyone's situation, but generally speaking, it's probably a mistake to claim before full retirement age. There are really only a few specific instances where it makes sense to take it early.
It would be great if you would explain why you say this.
One of the biggest experts on Social Security, Mary Beth Franklin, has said very recently in answer to these questions that it really only makes sense in the following situations:

1) If you are single and you are in very poor health or have a terminal diagnosis, something that makes it a good bet that you won't be living close to the average life expectancy.
2) If you truly need the money to cover basic living expenses in your early 60s and can't wait.
3) If you're married, and your lifetime earnings are very low while your spouse's are high, then it can make sense to go ahead and take the smaller check early. That spouse would still be covered in the event their higher-earning spouse died first, because as long as it's after full retirement age, the lower-earning spouse, even if they had started taking theirs early, could then switch and take the survivor benefit and get 100 percent of their deceased spouse's higher amount the rest of the way.

And her opinion is that while, yes, anything is possible with the government, it is extremely unlikely that any cuts to SS would affect the benefits of anyone in their 50s or older right now. Historically, changes have been phased in only for people who were very young when the changes were made. She says it would be a very poor decision to give up the locked-in benefits of delaying until 67 or even 70 just because you were worried about what the government might do some day.

But obviously it's a personal decision that people can make for any reason they want.

I'm certainly not an expert. But I do make a point to try to seek out people who are experts in a field and follow their advice. My wife and I will be waiting until at least 67 to claim unless one of us has a serious health situation before then.
 
She also thinks it's rose-colored glasses to also assume anyone taking SS early will do better than 8% investing it. You're guaranteed 8% more every year you wait after 62. Sure, you could make more. But good luck. Why would you just assume you will every year? And if you're smart enough to do that, you really shouldn't need a piddly little SS check.
 
Hypothetical question to the group….

Say you were in your late 40’s or early 50’s and you won a million (take home) in the lotto. How would you invest/use/whatever that money.*

*for the sake of the exercise let’s assume you already spent all you need on hookers and blow.
With my luck... have a heart attack the next day
 
Hypothetical question to the group….

Say you were in your late 40’s or early 50’s and you won a million (take home) in the lotto. How would you invest/use/whatever that money.*

*for the sake of the exercise let’s assume you already spent all you need on hookers and blow.
With my luck... have a heart attack the next day
Isn’t it ironic?
 
It’s a lot more than just a simple break even analysis for most people. For example two player mode complicates things a bit, particularly if one spouse’s benefit is significantly higher than the others. Most analysis I’ve seen in that scenario suggests the lower benefit spouse take theirs early, possibly even at 62, and the other wait until 70. The lower benefit spouse then switches to half of the other. That also maximizes the survivor benefit if the higher earning spouse passes first.

In general most “experts” seem to recommend waiting until at least full retirement age. Claiming at 62 lowers your benefit amount like 30%. Forever. And all future COLA adjustments are also based on this 30% lower amount, literally compounding the effect even more. Forever.

There are other considerations.
Claiming early may inhibit your ability to do Roth conversions.
It may make it less tax efficient to pull money out of a standard brokerage account (higher dividend or capital gains rates).
SS is tax advantaged compared to traditional IRA withdrawals since at most 80% is taxed, so getting a higher percentage of your income from that can lower tax liabilities.
If you’re still working when you claim that may reduce your benefits.
More of your income coming from SS in your 60s instead of pulling traditional IRAs will ultimately lead to higher RMDs (and taxes, for both buckets).

Lots to consider.
Can you explain the bolded?

As I understand it.......

Simple example: Let's say your PIA (benefit amount at full retirement age) is $4,000/month, and your spouse's is $1,800.

Scenario 1: you both claim at FRA. She gets the $1,800/month, you get $4,000 = $5,800 total.

Scenario 2: She claims early at 62, so gets $1,260 per month. You wait until 70, so you now get $4,900 (approx). She can now switch to half of your benefit, minus the amount she lost by claiming early ($540), so she'll get $1,910 going forward. So $6,810 total.

So in scenario 2 you get the cash flow from your spouse collecting early for those years, and she doesn't get penalized for doing so once she switches to half of yours. In fact she ends up with more than her PIA going forward, almost as if she had waited past FRA to claim.

Death benefits are a little complicated, but essentially if the higher earnings spouse dies first the surviving spouse gets 72%-100% of the larger amount depending on their age at the time.

Numbers might not be exact, but the point is that when you're married and especially if you have significantly different benefit amounts, it's not as simple as running 1 or 2 break-even scenarios.
 
I do think it’s interesting that with SS people tend to assume they might not live very long. But the same people, with the rest of their retirement planning are all worried about living to 100.

Assuming the benefits hold up for us olds, SS is the best “longevity insurance” there is.
 
She also thinks it's rose-colored glasses to also assume anyone taking SS early will do better than 8% investing it. You're guaranteed 8% more every year you wait after 62. Sure, you could make more. But good luck. Why would you just assume you will every year? And if you're smart enough to do that, you really shouldn't need a piddly little SS check.
And that's during years when you're getting a little more conservative with your asset allocation. And that's not even factoring in the lesser yearly inflation adjustment b/c you've chosen the smaller payout.
 
I financially plan on living until 100 so easy decision to postpone as long as they're giving me that guaranteed 8% increase each year that will also benefit from the inflation adjustments.

I expect there are plenty of people who plan to live to 100, or 90, or 80… and don’t.
And I'm ok with that. What I'm not ok with is running out of money so I chose a pretty conservative age until which I PLAN (not expect) to live.
 
Obviously it's unique to everyone's situation, but generally speaking, it's probably a mistake to claim before full retirement age. There are really only a few specific instances where it makes sense to take it early.
I don’t agree with this at all in terms of “probably a mistake.” If I didn’t have a lot of traditional 401k/IRA money that I want to transfer into Roths during low or no income years (either before 62 or 62+ because I have a good amount in taxable accounts to live off that), I would take it at 62 and invest it. I’m still too far away to know how many low or no income years I’ll have to transfer to Roths, but I’ve done a few advanced calls including investment returns from 62 to 70 and as long as you can get 6-7% returns on the money you get from 62-70, you would never catch up starting at 70. That means that the monthly investment income plus your year 62 SS monthly amount would be higher than your 70 SS monthly amount. Add in the fact that you “own” the nut that’s producing the monthly investment income (all the money you got from 62-70) and that nut is yours/your heirs if you pass early. You don’t own the money that’s producing the age 70 SS income above the 62 SS income.

My situation could be much different in that I expect my wife and I to both be getting close to the max SS so no worrying about spousal benefits. If SS was a much bigger nut in my retirement income I would also consider working longer and waiting for SS, but most people who start at 62 do so because they have to not because they want to invest. That said, most people in here don’t appear to fall in that bucket.

*The only reason I don’t want SS and transfer to Roths in the same year is because you can lose up to 50% of your SS benefits pre-67 if you have too much income and the transfer would be considered income.
 
Obviously it's unique to everyone's situation, but generally speaking, it's probably a mistake to claim before full retirement age. There are really only a few specific instances where it makes sense to take it early.
I don’t agree with this at all in terms of “probably a mistake.” If I didn’t have a lot of traditional 401k/IRA money that I want to transfer into Roths during low or no income years (either before 62 or 62+ because I have a good amount in taxable accounts to live off that), I would take it at 62 and invest it. I’m still too far away to know how many low or no income years I’ll have to transfer to Roths, but I’ve done a few advanced calls including investment returns from 62 to 70 and as long as you can get 6-7% returns on the money you get from 62-70, you would never catch up starting at 70. That means that the monthly investment income plus your year 62 SS monthly amount would be higher than your 70 SS monthly amount. Add in the fact that you “own” the nut that’s producing the monthly investment income (all the money you got from 62-70) and that nut is yours/your heirs if you pass early. You don’t own the money that’s producing the age 70 SS income above the 62 SS income.

My situation could be much different in that I expect my wife and I to both be getting close to the max SS so no worrying about spousal benefits. If SS was a much bigger nut in my retirement income I would also consider working longer and waiting for SS, but most people who start at 62 do so because they have to not because they want to invest. That said, most people in here don’t appear to fall in that bucket.

*The only reason I don’t want SS and transfer to Roths in the same year is because you can lose up to 50% of your SS benefits pre-67 if you have too much income and the transfer would be considered income.
And what if you lost money on your invested early SS money?
 
Obviously it's unique to everyone's situation, but generally speaking, it's probably a mistake to claim before full retirement age. There are really only a few specific instances where it makes sense to take it early.
I don’t agree with this at all in terms of “probably a mistake.” If I didn’t have a lot of traditional 401k/IRA money that I want to transfer into Roths during low or no income years (either before 62 or 62+ because I have a good amount in taxable accounts to live off that), I would take it at 62 and invest it. I’m still too far away to know how many low or no income years I’ll have to transfer to Roths, but I’ve done a few advanced calls including investment returns from 62 to 70 and as long as you can get 6-7% returns on the money you get from 62-70, you would never catch up starting at 70. That means that the monthly investment income plus your year 62 SS monthly amount would be higher than your 70 SS monthly amount. Add in the fact that you “own” the nut that’s producing the monthly investment income (all the money you got from 62-70) and that nut is yours/your heirs if you pass early. You don’t own the money that’s producing the age 70 SS income above the 62 SS income.

My situation could be much different in that I expect my wife and I to both be getting close to the max SS so no worrying about spousal benefits. If SS was a much bigger nut in my retirement income I would also consider working longer and waiting for SS, but most people who start at 62 do so because they have to not because they want to invest. That said, most people in here don’t appear to fall in that bucket.

*The only reason I don’t want SS and transfer to Roths in the same year is because you can lose up to 50% of your SS benefits pre-67 if you have too much income and the transfer would be considered income.
And what if you lost money on your invested early SS money?
When you start getting to 8+ year timeframes that greatly lessens the chance of that and also if you have that long, the stock market average returns are higher than the rate needed for the investment to produce enough to never catch up if you take at 70, again also ignoring the nut from 62-70. For my wife and me, the SS benefits from 62-70 should be around half a million and that doesn’t include any investment. The catch up year is way later when you take that nut and investment income into account.

If you take the basic breakeven year, you are almost at 20 years and even with the Great Depression, I don’t think there’s ever been a 20 year negative return. Again, I might even take at 62, because I’d like to transfer all our traditional to Roth at an effective rate close to 10% which you can do if you don’t have any real income and I don’t know if we’ll get that all done before 62.
 
Obviously it's unique to everyone's situation, but generally speaking, it's probably a mistake to claim before full retirement age. There are really only a few specific instances where it makes sense to take it early.
I don’t agree with this at all in terms of “probably a mistake.” If I didn’t have a lot of traditional 401k/IRA money that I want to transfer into Roths during low or no income years (either before 62 or 62+ because I have a good amount in taxable accounts to live off that), I would take it at 62 and invest it. I’m still too far away to know how many low or no income years I’ll have to transfer to Roths, but I’ve done a few advanced calls including investment returns from 62 to 70 and as long as you can get 6-7% returns on the money you get from 62-70, you would never catch up starting at 70. That means that the monthly investment income plus your year 62 SS monthly amount would be higher than your 70 SS monthly amount. Add in the fact that you “own” the nut that’s producing the monthly investment income (all the money you got from 62-70) and that nut is yours/your heirs if you pass early. You don’t own the money that’s producing the age 70 SS income above the 62 SS income.

My situation could be much different in that I expect my wife and I to both be getting close to the max SS so no worrying about spousal benefits. If SS was a much bigger nut in my retirement income I would also consider working longer and waiting for SS, but most people who start at 62 do so because they have to not because they want to invest. That said, most people in here don’t appear to fall in that bucket.

*The only reason I don’t want SS and transfer to Roths in the same year is because you can lose up to 50% of your SS benefits pre-67 if you have too much income and the transfer would be considered income.
And what if you lost money on your invested early SS money?
Another example of the inconsistent thinking I regularly see on this topic. People are willing to give up the guaranteed 8% increase every year because they assume they can invest and the market will deliver more than that. The average real return of the market is below that. And historically the real return of a 100% S&P 500 portfolio is negative over a 10 year period 11% of the time. And most people in their 60s aren’t 100% equities, so their actual returns are even lower. So this feeling that 7-8% real returns of a retirement portfolio over 10 years is virtually guaranteed, which is what I typically hear form the “I’ll take SS early and invest it” crowd, isn’t without significant risk.

And again, these tend to be the same people that are worried that a 4% SWR is too aggressive.

ETA: this is also based on people 100% investing that early SS money, even net of taxes on it. Who actually does that?
 

My situation could be much different in that I expect my wife and I to both be getting close to the max SS so no worrying about spousal benefits.
If you and the wife have 35 years of SS max income each you're absolutely killing it.

And again, these tend to be the same people that are worried that a 4% SWR is too aggressive.
:hey:

Definitely a possibility with current demographic trends. Alabama is officially in population decline and more states are right about there.
 
Hypothetical question to the group….

Say you were in your late 40’s or early 50’s and you won a million (take home) in the lotto. How would you invest/use/whatever that money.*

*for the sake of the exercise let’s assume you already spent all you need on hookers and blow.
Other than a 🦙 or an emu, and a green dress (but not a real green dress)?
We’d spend $700k on a lake house and the rest goes into our regular brokerage.
 
Obviously it's unique to everyone's situation, but generally speaking, it's probably a mistake to claim before full retirement age. There are really only a few specific instances where it makes sense to take it early.
I don’t agree with this at all in terms of “probably a mistake.” If I didn’t have a lot of traditional 401k/IRA money that I want to transfer into Roths during low or no income years (either before 62 or 62+ because I have a good amount in taxable accounts to live off that), I would take it at 62 and invest it. I’m still too far away to know how many low or no income years I’ll have to transfer to Roths, but I’ve done a few advanced calls including investment returns from 62 to 70 and as long as you can get 6-7% returns on the money you get from 62-70, you would never catch up starting at 70. That means that the monthly investment income plus your year 62 SS monthly amount would be higher than your 70 SS monthly amount. Add in the fact that you “own” the nut that’s producing the monthly investment income (all the money you got from 62-70) and that nut is yours/your heirs if you pass early. You don’t own the money that’s producing the age 70 SS income above the 62 SS income.

My situation could be much different in that I expect my wife and I to both be getting close to the max SS so no worrying about spousal benefits. If SS was a much bigger nut in my retirement income I would also consider working longer and waiting for SS, but most people who start at 62 do so because they have to not because they want to invest. That said, most people in here don’t appear to fall in that bucket.

*The only reason I don’t want SS and transfer to Roths in the same year is because you can lose up to 50% of your SS benefits pre-67 if you have too much income and the transfer would be considered income.
And what if you lost money on your invested early SS money?
Another example of the inconsistent thinking I regularly see on this topic. People are willing to give up the guaranteed 8% increase every year because they assume they can invest and the market will deliver more than that. The average real return of the market is below that. And historically the real return of a 100% S&P 500 portfolio is negative over a 10 year period 11% of the time. And most people in their 60s aren’t 100% equities, so their actual returns are even lower. So this feeling that 7-8% real returns of a retirement portfolio over 10 years is virtually guaranteed, which is what I typically hear form the “I’ll take SS early and invest it” crowd, isn’t without significant risk.

And again, these tend to be the same people that are worried that a 4% SWR is too aggressive.

ETA: this is also based on people 100% investing that early SS money, even net of taxes on it. Who actually does that?
You are also missing the fact that after 8 years, people have potentially hundreds of thousands of dollars sitting in their account. You aren’t making 8% on some pot of money if you wait. You get nothing until you’re 70. I understand your point of people not investing 100% but you have to model that because if you wait to 70, you got nothing from 62 to 70 so it’s OK to model a situation where you invest 100%. Just eating away at that 62-70 nest egg extends the break even point out years so the “catch up” models saying you catch up at 77 or 79 are way off IMHO. Then you are discussing 20 years of investing extra and there are no negative periods in history and there are amazing periods as well.

It’s not a one size fits all and I agree that if you have to spend a chunk of the 62-70 money that you should try to wait and keep working. I think the take at 62 is 90%+ people that have to do it but let’s be honest in all the discussion here how many people are in that boat. The people discussing all these options in here aren’t having to start at 62 to survive.
 

My situation could be much different in that I expect my wife and I to both be getting close to the max SS so no worrying about spousal benefits.
If you and the wife have 35 years of SS max income each you're absolutely killing it.

And again, these tend to be the same people that are worried that a 4% SWR is too aggressive.
:hey:

Definitely a possibility with current demographic trends. Alabama is officially in population decline and more states are right about there.
I don’t even know what the max value actually is but meaning we both should have enough years/amounts where we’d both draw and not use spousal. She didn’t work for a long time as a SAHM but she’s made up for it the last decade. We made up for lost time but still in the regular boat. I wish I had a real pension versus SS but it is what it is.

I think we’ll start early (probably not 62 if we aren’t done working for a bit and still have some Roth rolling over to do) because I don’t trust what may happen in the future but I think people already withdrawing have a much higher chance of getting grandfathered than not withdrawing. We may see some changes coming in the next decade or so.
 
Obviously it's unique to everyone's situation, but generally speaking, it's probably a mistake to claim before full retirement age. There are really only a few specific instances where it makes sense to take it early.
I don’t agree with this at all in terms of “probably a mistake.” If I didn’t have a lot of traditional 401k/IRA money that I want to transfer into Roths during low or no income years (either before 62 or 62+ because I have a good amount in taxable accounts to live off that), I would take it at 62 and invest it. I’m still too far away to know how many low or no income years I’ll have to transfer to Roths, but I’ve done a few advanced calls including investment returns from 62 to 70 and as long as you can get 6-7% returns on the money you get from 62-70, you would never catch up starting at 70. That means that the monthly investment income plus your year 62 SS monthly amount would be higher than your 70 SS monthly amount. Add in the fact that you “own” the nut that’s producing the monthly investment income (all the money you got from 62-70) and that nut is yours/your heirs if you pass early. You don’t own the money that’s producing the age 70 SS income above the 62 SS income.

My situation could be much different in that I expect my wife and I to both be getting close to the max SS so no worrying about spousal benefits. If SS was a much bigger nut in my retirement income I would also consider working longer and waiting for SS, but most people who start at 62 do so because they have to not because they want to invest. That said, most people in here don’t appear to fall in that bucket.

*The only reason I don’t want SS and transfer to Roths in the same year is because you can lose up to 50% of your SS benefits pre-67 if you have too much income and the transfer would be considered income.
And what if you lost money on your invested early SS money?
Another example of the inconsistent thinking I regularly see on this topic. People are willing to give up the guaranteed 8% increase every year because they assume they can invest and the market will deliver more than that. The average real return of the market is below that. And historically the real return of a 100% S&P 500 portfolio is negative over a 10 year period 11% of the time. And most people in their 60s aren’t 100% equities, so their actual returns are even lower. So this feeling that 7-8% real returns of a retirement portfolio over 10 years is virtually guaranteed, which is what I typically hear form the “I’ll take SS early and invest it” crowd, isn’t without significant risk.

And again, these tend to be the same people that are worried that a 4% SWR is too aggressive.

ETA: this is also based on people 100% investing that early SS money, even net of taxes on it. Who actually does that?
This is just not taking everything into account.
A guaranteed 8% return on future income does not take into account the fact you are receiving nothing now. So, if I start receiving benefits at age 62 and for 8 years, I accumulate an 8% return on those benefits, it will take quite a while for you to overcome the money I have in my account (if you ever do). Sure, there is a very good chance that there will be some down years in the market over those 8 years, there will also be some better than 10% up years as well.
But moreso, nothing is guaranteed, be it your life, nor SS benefits to continue to be provided.

I definitely side with there is not one size fits all argument for when to start taking benefits, but as a pragmatist, I'll be taking them at age 62, and I will not need it.
 
Damn that’s scary. This whole birthrate dropping thing has large impacts, and this is one of them. Given the trend that I posted above that we’ve seen, is it projected to get worse?
Yes, the demo cliff hit in the mid-late aughts and didn't stabilize for about a decade.
 

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