T & A

by Tom
(Seattle, Wa)

Providing for my wife who has a limited working career is paramount for inflation adjusted SS benefits, so maximization of SS along with survivor benefits is critical. The predominant thinking (other than taking SS as soon as possible) is for the lower earning spouse to attain Spousal payments on the higher earning spouses record after the higher earner applies for and suspends their SS benefits (the higher earner – me - is older by 4 months). This works well, but for us, the following will work even better. I plan on having my wife apply for her SS benefits at 66. Since I haven’t applied for benefits, she is not eligible for Spousal payments. Her SS benefits will be about $10,000 a year. I will then apply for Spousal benefits, ONLY, on my wife’s record and receive about $5,000 a year for a total of $15,000 a year until we reach 70 years old. At that time, I will apply for my own SS benefits and receive the increased amount for the delay in filing of around $37,000. My wife will continue receiving her regular benefits of $10,000 plus some Spousal payment for life of about $4,000. Our total will be about $51,000 per year for the rest of our lives. Her survivor benefit will be about $37,000, adjusted for inflation. Applying the other way; I apply and suspend at 66 while she applies for both SS and Spousal, provides about $13,000 a year for the rest of my wife’s life. I would receive about $37,000 a year from age 70 on. My wife would still receive a survivor benefit of about $37,000. The difference is about $2,000 a year for 4 years (66-70), then $1,000 a year for the rest of our lives. This is for doing nothing more than applying at the right times in the correct manner for our situation. Everyone’s situation is different and that’s why there are so many alternatives. With alternatives comes complexity. With SS being such an important source for our retirement years, I feel very strongly about using every source possible in determining our preferred path. Just remember to verify everything with the SS department.

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Mar 05, 2013
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Financial Rep Evaluation
by: Tom of Seattle

I took all my data to a fincial planner for an experts evaluation. The first thing he recommended was taking SS as soon as possible. I asked him why he would say that without any knowledge of our financial situation. His reasoning was because of the crossover points that are extended so long into the future. After our session I went home and ran an evaluation using ESPlanner. I compaired taking SS as stated in the T & A evaluation with taking SS now (we are coming up on 64). Taking SS now would REDUCE our discretionary spending by about $9,000 a year for the rest of our lives. It would also lower the money available to my wife as a survivor. My lesson: everyones situation is different, while experts evaluations are usefull, they are not the only, or in this case, best answer. No one knows you, like you, put that knowledge to good use. Know were the numbers come from, what's valuable to you, and put that to good use. There are many good programs out there. I especially like ESPlanner and Socialsecuritychoices. ESPlanner has a SS section also, but I haven't used it.

Oct 17, 2012
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Thank you John
by: Tom

Thank you John, As I stated, this works best for our situation. Change anything, like our ages, working careers, our savings (to support the delayed Social Security claiming dates), and our whole plan could change.
I spent a lot of time in various sites, including the SS website. In the end the SS website was used for verification only (it's a very large and confusing site). The first site that impressed me, and I continue subscribing to today is ESPlanner; http://www.esplanner.com. There were some mistakes or missed refinements on the site when I started, but I believe they're corrected now. This site helped put together a complete retirement plan (financially speaking)and is giving me the confidence to move forward. The next site that helped me refine my SS strategy, and point out the mistakes on ESPlanner, was Social Security Choices, http://www.socialsecuritychoices.com. The presentation (with three scenarios)on this site is straight forward and easy to understand. I wholeheartedly recommend both these sites.
Happy Calculating, Tom

Oct 17, 2012
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Very Helpful Post
by: John Howe

This is a very helpful post for couples trying to decide how to maximize their Social Security benefits.

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