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Lane
Lane, JD,CFP, MBA, CRPS
Category: Social Security
Satisfied Customers: 10122
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial, Social Security & Tax advice since 1986
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I am a 62 year old and currently working an plan to do so

Customer Question

I am a 62 year old and currently working an plan to do so into the foresable future . I have a relatively high income. I have a minor child who is 9 years old and I wanted to claim my social security income so my son can receive his benefits. I know that given my income I probably will receive zero benefits on my part but I have told my child will receive his benefits. I am getting conflicting information on when will be best to apply. Some people tell to apply now becuase if I continue to work I will recoup all of benefits if I continue to work and pay into social security. Others tell that I should wait until I am 66 when the earn income rule does not apply and if I apply early that it will many years if ever that I will recoup the benefits that I loss by apply for SS earlier. Any advice will welcome on my case.
Submitted: 6 months ago.
Category: Social Security
Expert:  Lane replied 6 months ago.

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For prospective and current retirees who are concerned that “unexpected” or extreme longevity may lead them to run out of money, there are few strategies more effective than the decision to delay Social Security benefits.

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The tradeoff – where payments are not received now, in exchange for higher payments in the future – is similar to buying an income annuity, or investing in a bond ladder that will begin liquidating in the future…

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EXCEPT that the implicit “pricing” of the decision to delay Social Security is far better than any commercial annuity or bond yields available today.

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So it's not that the information conflicts, you just have to look at the two strategies and make some assumptions about the unknow ... such as your longevity, AND the less qualtifyable things such as how much you need the cash flow as compared to the need in your later years.

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Both of these can apply. And there are trade-offs depending on your assumptions.

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For example, if you're trying to maximize the total benefit coming into the household (AND you assume that you live a very long life, as we are seeing) delaying, getting a FULL benefit, and THEN getting those delayed retirement credits of 8% a year between age 66 and 70 and THEN receiving that higher amount for the next 20 years or so, will likely offset value of taking a much lower benefit forever to get the child's benefit.

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Also, a spouse and multiple young children start to make this more and more favorable.

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Are you married or single?

Expert:  Lane replied 6 months ago.

And if married, how old is your wife?

Expert:  Lane replied 5 months ago.

Hi,

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I’m just checking back in to see how things are going.

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Did my answer help?

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Let me know…

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Thanks

Lane

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