Can Withdrawing Be a Way to Get an Interest Free Loan?

Jul 1 2016 - 1:30pm

I am 63 and my wife is 59. We are healthy and plan to live for a long time. We both have the flexibility to continue working part-time as much as we want for as long as we want. We can start withdrawing from our IRAs anytime. We plan to wait until we turn 70 to start taking benefits but would it make sense for me to start taking benefits now and for her to start when she turns 62 and then reclaim when we turn 70? My understanding is that we would pay back the benefits we had received up to that point and begin receiving benefits at the higher rate based on claiming at 70. If we start receiving social security benefits now then we will delay withdrawing from our IRAs so the funds to repay the "loan" will be available. Since lifespan is uncertain this seems like a better strategy than waiting until 70. Am I missing something? Thanks, Michael

Michael, because Social Security does not exist to provide interest free loans, you can only withdraw an application and repay benefits received within 12 months of beginning them. Thanks, John