Retirement

[Marsha/CA]

Thanks Phil,

I actually took the time to do an internet search and found it.   You get a senior version of "American The Beautiful Pass".  Dummy me, I should done a search in the first place instead of taking the easy way out and asking.  I've been looking forward to that pass for several years now.

Tim and I have been mulling over taking Railroad Retirement (same as social security) at 62 instead of later.  We need to run the numbers.  But I'm thinking now rather than later.  I'm looking at every angle to help with this costly fuel situation.   

Marsha~

[Jim Johnson]

at 62 instead of later

I took a retirement briefing before I retired and the general theme was, "If you need the money to make it through retirement, wait until 65-68.  If it is not a 'make or break' deal, then take it at 62.

[Ned]

I would argue that in any case you're better off taking the money at 62.  Even if you don't need it, take it and invest it until you do and you'll be far ahead of waiting until even 65.  When I did the math on my benefits, the breakeven age for total benefits paid from 62 vs. 65 was around 81 years of age, without factoring in inflation and cost of living indexes.  Those would make taking the more valuable early dollars even more attractive.

[Marsha/CA]

Tim actually ran the numbers about a year ago and the extra we would get by taking it at 65-68 was not a lot different than taking it at 62.

I was kinda looking at it this way.  None of the Railroad/Social Security benefits pass on to the kids.  So why not get it at 62, save some of my own private money that can be handed down.  That is if anything is left over.     I also think Railroad Retirement/SS will be a mess at some point.  So why not get into the system and get started.

Hopefully someone will put this thread back on track, or staff will have to move it....

Marsha~

[Tom]

Marsha,

Maybe we should take the money before the SS systems runs dry 

[Marsha/CA]

Marsha,

Maybe we should take the money before the SS systems runs dry 

That's what I was subconsciously thinking. 

BTW, you beat me to it.

Marsha~

[Ron]

I took out SS when I turned 62.  You really can't loose taking it early.  Just remmeber who has control of it while you wait till 65.  Not a risk I care to take.

[aka Porky]

I took my SS at 62 for one very simple reason.  No male on my dads side of the family had ever lived past the age of 45 until his generation.  He and his youngest brother were the only two (out of 5 brothers) to live past 60.  What were my odds

I had my first quadruple bypass at 53, my second quadruple bypass at 62, drove the old Bounder to Alaska at 67, had a stroke at 68 and here I am going to turn 70 on the 25th of this month and still sassing all the folks on this forum .  I wasn't supposed to live this long.   I say get it while you can.

Life is good, God is great and the rest is tolerable.

[Mike Goad]

I would argue that in any case you're better off taking the money at 62. 

In my case, I have to.   

I took an option on my retirement pay that gives me significantly more money than the basic plan for the first seven years.  Then, at age 62, it drops by the amount that it was estimated I would be getting from social security, without factoring in cost of living increases. 

It made the difference between being able to retire at 55 and having to wait quite a while longer.   

[Bob Maxwell]

And Marsha, railroads are going to br doing real well $$$$ the next decade or so.

A friend of ours [and the treasurer on Bev's BoD] is setting up the new degree program at Michigan State in Rail Transportation, the first in the USA in decades. He started the project two years ago to begin this fall. Great planning!

[Pierat]

Of course, if you take Social Security before full retirement age, they'll dock you if you work and earn above a certain amount (about $12-13K, I believe) annually. That restriction goes away at full retirement age. In any case, as I understand it, Medicare starts at 65, no docking involved (so to speak). So, check it out carefully before deciding.

[Marsha/CA]

Bob....can I tell you that you look "good" in the cowboy and clerical collar.....   The new look is YOU.   I almost thought we had a new member named Bob Maxwell.

I hate to admit that we have railroad stock that has done extremely well in the last few years, and will probably do even better in the upcoming ones.  Railraod stock splits often, so Tim has hung onto every one he has.

If we take the early Railraod Retirement, it's a fixed amount like Social Security; but it's higher than SS.  He has just about as many years working with the railroad as he did in the private sector for SS.  Your friend hit it just right on the Rail Transportation program at Michigan State.  I would bet there will be lots of employment opportunities with the railroad in the upcoming years.

John, we've been doing some checking and realized that we can't earn very much i.e. the $12-13K.  What I can't remember is if that includes investment earning or just income via an employer.  If it's just via an employer, then we are safe.  Tim doesn't want to work any more.....   He wants to stay home and play with our granddaughter and that cute poddle puppy.

Marsha~

[papahog]

I believe it is just from work preformed for pay and not income from investments.

I did not get to decide at age 62 as disability forced me into retirement a year before that.  However I was going to take SS at age 62 and not look back.  Bad heart makes this decision easy.

I am happy to be retired and can not work if I wanted to, which I don't.  Life is good and grand-babies are a bonus.

[eddieelk]

Hi, y'all.  I took my SS at 62(1998) & kept working full time until 65(2001).  I worked on and off after that.  I had heard that if your kept working past 65, you would get higher monthly benefits since you continued to pay into SS.  Then in Sept. 2005 I got a suprise from SS when they deposited a extra $8,703.00 into my checking acct.  I thought it might be a mistake, but two weeks later got a letter stating they has made a mistake figuring out my benefits after age 65 because I was still working.   My monthly benefit also increased $240.00.  I'm still woring part-time when we're not on the road, and am looking for another back pay check from them.  It does'nt hurt to complain.

[Wendy]

Marsha - It's "earned income" you have to worry about, like from a job (whether paid by an employer or self-employed). Investment income doesn't count. Good reason not to work, eh? Of course, if you make too much money, earned or not, you end up paying income tax on SS.

Wendy

[Marsha/CA]

Thanks Wendy,

WhenTim and I started looking at all the info for SS and Railroad Retirement, we were indignant that we had to pay taxes on the benefits.  Then someone said something to us that it was taken out pretax, similar to a 401K, so we had to pay tax on it.  drats!!

Marsha~

[Wendy]

The year Mike retired from NPS, he got a lump sum payment from the government. I didn't like paying taxes on that but, hey, what can you do. But, that year MY social security was taxable ! I was p***ed, er, really, really mad. I even ran the numbers if we filed joint, filed separate, got divorced and filed single separately. Finally bit the bullet and paid the tax.

Wendy

[Tim Lassen]

I decided that my best option was to begin taking retirement benefits at 62 and have Marsha go back to work full-time...tim

[Marsha/CA]

I decided that my best option was to begin taking retirement benefits at 62 and have Marsha go back to work full-time...tim

Dream on Big Boy.....

Marsha~ (Tim's wife)

[harley man]

Marsha&Tim
I was late getting into a job with benefits (POST Office) so I worked past 65,  had I taken SS at 62 while still employed full time I would have had to give back one dollar for every three earned from SS.I have been retired for four years and until a year ago had to pay IRS tax on 80% of my SS income because of making too much.

I feel for the younger workers who will have to reach 67 before full SS benefits.

The internet site for SS and  Rail Road benefits have material available for downloading or information you may order by mail.

The Rail industry is going to come on strong freight wise with fuel prices parking over the road shipping.

Enjoy

[Marsha/CA]

Harley Man,

It sure seems like an unfair system, doesn't it?  You put in for all those years and you would think they would just let you have the benefits without all the limitations.  And, I agree I feel for the younger workers too who have to wait until 67 to retire.  We were lucky in that Tim could retire at 58.

I have a sister than was a Post Master in Angola, Indiana.  She is now a union grievance <sp?>examinator. 

Marsha~

[Ron]

I decided that my best option was to begin taking retirement benefits at 62 and have Marsha go back to work full-time...tim

Sounds like a good plan IF you can accomplish it.

[JoAnn]

I find this thread very interesting as Jim just turned 60 last week and will retire in 2 years.  I have a question.  I am 2 years younger and will probably continue to work until I turn 62.  So from what I'm understanding, my income will affect taxes he has to pay on his Social Security, but his pension and investment income will not???   I find all of this so confusing, I really appreciate all of your expert input.

JoAnn

[Alaskansnowbirds]

I'm sure Wendy will correct me if I wrong but it's my understanding that your income has no effect on his SS. He is only allowed to earn so much before they start reducing his SS.

[Wendy]

Your husband's social security receipts MAY be taxable. When you fill out your Form 1040, you have to calculate whether or not any SS receipts are taxable. There's a separate worksheet you use to figure this out. On that worksheet, you include half your SS $, all the amounts you listed under the Income section (wages, dividends, interest, etc), less any adjustments. If that amount is more than a certain amount ($32,000 last year for those filing jointly) then the SS receipts MAY be taxable. It's hard to explain but easy to follow the worksheet when you have all your tax info handy. If you have a copy of your 1040 instruction booklet, you can see how it's calculated there.

IRS explanation
1040 Instructions (PDF) - page 25 has the worksheet

Hope this helps and that I didn't just confuse the heck out of everyone. Bottom line, sometimes it's better to file separate returns or get a divorce and just live together

Wendy
Cortez CO

[aka Porky]

Wendy, your advice and info is right on.  I can tell you from experience, however, that divorce can play havoc with a lot of retirement dreams and finances.

Recovering nicely in North Carolina, lou 

[motojavaphil]

Just got my Army Retirement Orders over the internet.  It has been a pleasant night with big smiles and thinking when I can go on the dole in the near future.  Life is good.
Phil

[harley man]

Dear Marsha, I keep braggin bout Gary & Tom but youse and Wendy are NO slouches! I loved my work and my customers at the PO but Management did me in,the latest PO General is anti labor and employees are retiring as early as possible. my Wally World, Lowes, Home Depot and other places are their employer's now! It is so sad! I keep in touch with things and now they are trying to make it mandatory that we lose our health benifits upon reaching 65 and must rely on medicare A&B. Hell, that's why I left the Auto Business, to get a decent UMBRELLA!

[AuntSmurf]

Bill and I are taking our "retirement" early.  When he turns 62, he's drawing SS.  He plans on working that year until he draws close to the max allowed for the year, then quitting.  We figure he'll have to quit his job sometime in May.  We're going to bank his SS until then, padding our nest egg a bit more.  (He turns 62 in mid Dec 09 and will start drawing Jan 2010.)  Bill's 8 yrs older than I am, so I'm going to work until mid July.  Then we're traveling the rest of that year.  He's got a Pension from Des Moines, and figure between the two of them we should be in fairly good shape.  WorkCamping will be an option for us from then on.  I feel a bit guilty, retiring at such an early age.  But we've discussed it, and it makes more sense for us to both work part time, if needed, than for me to continue to work full time, while he sits at home.  Our health is good, and we don't want to take the risk of his taking SS later, and not being able to enjoy life after retirement.

[JoAnn]

Ok, what confuses me even more is Medicare and health supplements.  I have 3,  women who work for me who are between 65 and 72,  and they are always complaining about raising medical  and co pay costs.  What suggestions do you have for a good supplemental coverage at reasonable prices.   What about prescriptions?   We have been covered all these years under my husbands work (Teamsters) coverage. I never had to think much about it.  Just showed the card and everything from Dr. visits, prescriptions, eyeglasses, and dental have been covered, with a small copay.   The thought of worrying about paying these things scares the daylights out of us.  If he retires at 62 there will be a reduced (I know there is just not sure how reduced) gap coverage until he's 65.  I'm 2 years younger and need to find out about coverage for me during those 2 years.   Things should get less confusing as we get older and it seems to be worse.  Thanks for any help or suggestions.

JoAnn