Social Security Confusion

Mr. Moderator,

Do you think anyone like to comment or provide information/guidance to the following post, if this is not something the group may not want to read please do not post.

thanks

Here is our situation - Any advice will be welcomed.

I am retired DoD Civilian (35.5 years of Service), Civil Service Retirement System (CSRS), and have paid 36 Quarters of Social Security Prior to the Government Civilian job ¡V current age 58.

My wife worked for a large Grocery Chain and recently started drawing her SS at 62.

My concerns are: Catch 62 - If a veteran is a US Government employee and retires his/her CSRS retirement will be reduced by 2% per year of Military Service if they do not pay in 7% of the monies they made while on Active duty to the CSRS. This happens when and if they become eligible to draw Social Security (age 62). Notice there is no Option ¡§When they become eligible¡¨. This was signed by President Reagan around 1986. I had 3.5 years of Military duty and had to ante up $1150 for the time served. Believe me I did not have that much fun, travel and adventure.

Windfall Elimination Act - When I elect to start drawing my Social Security after age 62 I will not be able to draw the full amount, I am not sure what it will be but friends of ours are getting about 50% of their benefit check. If I die before my wife she will have an option to draw 55% of my CSRS pension or my Social Security. If she dies before me I get nothing. I will not be able to collect any of her Social Security and only a partial amount of mine.

I have gone back to work to get my additional Social Security Quarters paid and to add some $$ to the savings.

The CSRS has/had some good benefits, so I cannot complain too much but this seems terribly unfair especially the spousal benefits that we cannot receive.

Thanks

CONSERVATIVE safe investment (5%), from age 62 to 65, and not used it for living expenses UNTIL I reached age 65, that I would have had to live PAST age104 before I realized a difference in income.

I did similar calculations and began taking SS early. In the same AARP Bulletin, there is another article on when to start taking SS

One of the comments made by that author as areason to start early is: "You don't need the money. You are comfortablefinancially, so you plan to invest your benefits." In my case, it allowed me to "not withdraw" funds from my Roth IRA. So for the last three years, during which I've gone from age 62-65, I've averaged

16.2% per year in that account.

--ron

I can only relate my personal position. When I approached age 62, I did the research, and crunched the members.

I missed this the first time. Which members were you crunching? Those working for social security?

Elizabeth Richardson

Very astute ! ! ! I was referring to those bureaucrats at S.S. Cal

I missed this the first time. Which members were you crunching? Those working for social security?

Elizabeth Richardson

I think the AARP observation is almost, but not quite, correct. Change 62 to "full retirement age", and it will be correct.

For a spouse with a small benefit, taking benefits at full retirement age, instead of waiting until 70 can make sense, even if the other rules of thumb say otherwise. For the sake of argument, let's assume both spouses are the same age, and the larger wage earner is deferring benefits to age 70 (this is where being in good health comes in; at least one spouse would be expected to live past age 82 or so, and thus gain by deferring benefits until age 70).

The other spouse (typically wife) should start drawing at age 66 (i.e. full retirement age). For four years, until age 70, that spouse will draw benefits on her own earnings. At age 70, the husband starts drawing, and the wife draws half the full retirement amount.

Had the wife waited until age 70, she would have gotten nothing for four years, and then at age 70, started with the same amount - half her husband's full retirement benefits. There's no increase in what she would get because he started later. The most she can get is half of his full benefit. So four years of benefits would be lost.

The numbers don't work out as neatly if she starts drawing at age 62, which is why I'm not convinced the AARP article is entirely correct.

Mark Freeland snipped-for-privacy@sbcglobal.net

My husband retired after 33 years (CSRS). We knew the Windfall Elimination Act would reduce his SS by about 50%, but we can collect all of mine as long as I live...correct? We were not aware that he would not be able to collect my SS when I die...is this really true!!! :-(

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amount her husband would have gotten had he retired at age 62. And even if she waits, there's no point in deferring the start past full retirement age, because a person receiving 1/2 of spouse's benefits never gets more than 1/2 the spouse's full amount. No bonus for the spouse deferring past full retirement age.

>

"full retirement age", and it will be correct.

instead of waiting until 70 can make sense, even if the other rules of thumb say otherwise. For the sake of argument, let's assume both spouses are the same age, and the larger wage earner is deferring benefits to age 70 (this is where being in good health comes in; at least one spouse would be expected to live past age 82 or so, and thus gain by deferring benefits until age 70).

retirement age). For four years, until age 70, that spouse will draw benefits on her own earnings. At age 70, the husband starts drawing, and the wife draws half the full retirement amount.

years, and then at age 70, started with the same amount - half her husband's full retirement benefits. There's no increase in what she would get because he started later. The most she can get is half of his full benefit. So four years of benefits would be lost.

why I'm not convinced the AARP article is entirely correct.

Mark, thanks for explaining this so lucidly. I hadn't known about no bonus for spouse waiting beyond full retirement age.

Pete