Social Security Benefit Formula Robs Older Workers

[Happyhorn52]

What I take away from this is that the gov averages your 35 best earning years, so that unless by working longer you are replacing low earning years with high earning years you are only increasing your payout by a few dollars. The author uses a high wage earner in his example but It works that same way at every wage level. Your monthly check goes up by taking SS at 70 but that's because you are getting the same payout over fewer years. As the author says you and your employer are contributing another $19k to the system for a $9 a month increase in your SS check. 

Edited October 24, 2016 by Happyhorn52

[robert k]

Most (virtually all) men in my family don't live to 70 years of age.  Most don't live to 66. The majority don't live to be 62 and sad to say my brother will probably be in this group.

I of course will live forever because I have not suffered enough to pay for my sins in lives past. 

I will still take Social Security at the earliest time.

[davewe]

I went to one of those Social Security seminars, the kind where they give you a free meal to hear a financial adviser lecture and try to get you to give him your money.

He too advised waiting to take SS, showing charts and diagrams about how much more you would earn over the course of an average life.

However the cross over point - the age where you actually have taken in more money overall than if you had retired at 62 - was age 83. I raised my hand and wondered whether I wouldn't be better off with the money in my 60s rather than my 80s, when I'd be less able to use it. He agreed that I had a valid point. Of course he was looking at my wife when he said it 

[Happyhorn52]

On 10/22/2016 at 9:37 AM, Old55 said:

I did a crude analysis before singing up for SS at age 62. For me when I compared taking SS at 62 Vs 66 the total amount paid out are almost identical at around age 76 ($286,740 Vs $286,572) and after age 76 waiting to take SS is the better deal. The big questions are how long will you live and is it worth it to wait for a larger SS check in your later years.

 

Edited October 25, 2016 by Happyhorn52

[robert k]

If you expect to live into your 80's and are living in a first world country with well equipped ambulances and hospitals, maybe it makes sense to wait. If you live in small town Philippines you may not achieve that great age. If you live in Manila but not near a hospital, likewise you may not reach that great age. Graphs, scales and charts are not the only considerations.