First of all, waiting to 70 to draw SS is not an option I want to consider. My question is why should I wait to FRA to start receiving SS? Here are the facts:

I was born in Feb.1956. (I will be 65 in a few days). My FRA is 66 years and 4 months, which I will reach in June 2022. I retired almost exactly one year ago, (at the end of Feb. 2020) at 64, after reaching 35 years of employment in my chosen field (previous years were in much lower paying student jobs). My estimate if I retire at 65 is 1,901 (Let’s say 1,900). If I retire at FRA 66/4, my estimate is 2,087 but that is based on the assumption that I will continue to make the 16,087 that I made in 2020 (I only worked two months before retiring at the end of February 2020). Does it really make sense to wait until FRA? Since I am no longer working (and I am enjoying that) and I have reached the highest 35 years I want, my benefit will not increase, will it?

My goal is to leave as much of my 403B to my beneficiaries as possible. I live simply, with the occasional splurge. Currently I am covering my expenses with a portion of my 403B that I annuitized (and will receive till the day I die) and an additional 1,500 that I am drawing monthly from my 403B. I intend to stop drawing from my 403B once I start receiving SS until my RMDs at age 72. The current SS estimate of 1,900 and the annuity (of approx. 850) will more than cover my expenses as I have no mortgage.

So the way I see it, waiting 16 months to FRA is “costing” me the 1500 I would be withdrawing during that time from my 403B ($24,000) as well as the estimated benefit of 1900 monthly that I am NOT taking from SS for the same 16 months (or $30,400). Therefore, waiting 16 months to my FRA will cost me 54,400! EVEN IF THE MORE OPTIMISTIC FRA BENEFIT WERE TRUE (which I don’t think it is, since I’ve stopped working) it would take over 24 years of an additional 187 bucks a month (to age 89) to make up the 54,400 I would lose by waiting to FRA.

Everyone tells me to wait to FRA but it doesn’t make sense to me. Am I missing something?

BTW, I am divorced and am happy in that state. Even though my ex subsequently went back to school and has been a lawyer for the last 16 or 17 years, I don’t think that 50% of his SS would be higher than that based on my own earnings, as I was the major bread winner through most of the 20 year marriage that ended 22 years ago.

Because of that, neither do I have to be concerned about maximizing my survivor’s benefit for anyone.

So have at it. Go ahead and tell me why should I wait to FRA?

Hi,

Waiting until a later age to start drawing benefits is not necessarily the best option for everyone, so I would never try to dissuade you from starting your benefits early if you've done the proper research and have determined that that is the best choice for you given your particular set of circumstances. When you choose to start drawing your benefits is entirely up to you, however, you may want to strongly consider using our software (https://maximizemysocialsecurity.com/purchase) so that you'll know the true potential long term effects of your decision.

One of the reasons that we often recommend waiting to start benefits is that Social Security retirement benefit rates continue to grow until age 70 as long as you don't start drawing your benefits before then. The rate of increase from a person's full retirement age (FRA) until age 70 is 2/3rds of 1% per month, or 8% per year. The rate of increase for years prior to FRA is slightly less than that, but still averages out to more than 7% per year. That's a much higher rate of return than most people can expect to receive on other types of no risk investments. And, those increases occur regardless of whether or not a person continues working.

Another reason for waiting to start benefits is the insurance value of being able to rely on a higher monthly benefit rate for as long as you live. The worst case scenario is outliving your assets, and by exercising patience (If that's what our software says is best to do since patience may not always be the best strategy.) you are assuring yourself of a higher benefit for life no matter how long you may live.

Best, Jerry