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Posted by Elizabeth Richardson on September 24, 2007, 2:35 pm
Ok, having been duly convinced that delaying the taking of SS benefits is a
wise financial course for me, how do I go about deciding when is the most
optimal time to start taking benefits? Is this a risk/reward question or is
there a formula I ought to be playing with? (Yes, I know I ended that
sentence with a preposition, but I'm too lazy to reword it.) And if there is
a formula, what is it?
Elizabeth Richardson
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Posted by Douglas Johnson on September 24, 2007, 3:02 pm
>Ok, having been duly convinced that delaying the taking of SS benefits is a
>wise financial course for me, how do I go about deciding when is the most
>optimal time to start taking benefits? Is this a risk/reward question or is
>there a formula I ought to be playing with?
This is a question that I am trying to figure out myself. I do know any formula
will start with your date of death. When you know that, it will be too late.
I think that, if you are healthy, with long-lived ancestors, you should delay as
long as possible, given that Social Security is an inflation adjusted annuity,
it provides good insurance against outliving your money.
Conversely, if you are from short lived stock and ill, you probably ought to
start as early as possible. None of us are promised another sunrise.
The question gets more complicated if you are married. The surviving spouse
gets the higher of the two social security payments. Say your husband is
already retired and drawing Social Security at a rate that is higher than your's
would be if you waited to start. Then, his SS payment provides longevity
insurance, because you will get his payment if he dies first. In that case, I
would start drawing as early as possible.
The above is my current thinking. I'd love to hear corrections or additions.
>(Yes, I know I ended that
>sentence with a preposition, but I'm too lazy to reword it.) And if there is
>a formula, what is it?
As Churchill said, "That is a convention with which I will not put up."
-- Doug
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Posted by David Moore on September 24, 2007, 5:21 pm
For careful treatment of Social Security issues, it's hard to beat
the work of Alicia Munnell and others at the Boston College Center
for Retirement Research. Click on publications, then on Social Security
under Topics. The original poster might look at Munnell and Soto,
"Why do woemn claim social security benefits so early," for example.
David
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Posted by Douglas Johnson on September 24, 2007, 7:15 pm
dsmoore@stat.purdue.edu (David Moore) wrote:
>
>For careful treatment of Social Security issues, it's hard to beat
>the work of Alicia Munnell and others at the Boston College Center
>for Retirement Research.
A direct link is here. http://crr.bc.edu
Most of the papers deal with the societal and policy implications of Social
Security.
>Click on publications, then on Social Security
>under Topics. The original poster might look at Munnell and Soto,
>"Why do woemn claim social security benefits so early," for example.
A direct link to this paper is here: http://crr.bc.edu/stories/Briefs/ib_35.pdf
It addresses the issues pretty directly. Scott Burns wrote several articles
derived from this paper. You should be able to find them at www.scottburns.com.
-- Doug
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Posted by Elizabeth Richardson on September 24, 2007, 8:05 pm
>
> For careful treatment of Social Security issues, it's hard to beat
> the work of Alicia Munnell and others at the Boston College Center
> for Retirement Research.
This was the article and website that made me realize I should be delaying
my benefit. There was a discussion on this issue a few months ago. I am
simply asking is anyone has insight on an optimal time to start taking
benefits.
Elizabeth Richardson
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