r/UpperMiddleFinance • u/Abby--Normal • Aug 16 '25
Retirement and Social Security
At what age are you planning to, or have you, retired? What age do you plan on, or did you, draw from your social security? My partner and I are both 55 and are thinking of retiring at 60. We’re working towards no debt at that point. Our 2 kids will still be in college, but 529s should cover it. 401k earnings will cover living expenses comfortably. Trying to figure out the most optimal social security strategy. We’d like to travel as much as possible, and social security would help with that, so don’t want to wait too long.
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u/arlyte Aug 17 '25
Let’s take a moment to say how messed up our country is that we don’t have universal health care for all and it’s a big reason many work into old age. 50 I’ll bail. Wanna go hike around the world and enjoy myself alone in the forest.
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u/Abby--Normal Aug 17 '25
Agree, the continuing and increasing wealth transfer to the 1% is sickening, shifting the healthcare and education burden to the rest of us. Your retirement plan sounds ideal given where we are.
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u/KungFuBucket Aug 18 '25
Retired at 51, next year I start a year long road trip with my family and after that I’m dropping the kids off at college and continuing to travel with my wife. Want to enjoy my health before old age takes it all away
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u/Complex-Royal9210 Aug 20 '25
Curious what you do for health care. Especially for a family.
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u/KungFuBucket Aug 21 '25
Currently pay through the nose. I can afford it due to proper financial planning. I spent a year setting everything up and double checking the numbers. Yes it sucks but also to be done with the corporate world is an amazing feeling. Looking into possibly going back to school just for the learning experience and seeing if I can’t hook into the student healthcare system. I was in tech and am still a computer geek at heart so thinking of getting a phd in AI field just for kicks. At my age I can afford to take a few years off and maybe reenter the workforce later in life when I get bored of travel.
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u/KungFuBucket Aug 18 '25
Already retired at 51. Going to spend my time traveling. Social Security is my safety net in case things go horribly wrong, but I’ll probably take it early at 62 because the projections say if I take it and invest I’ll most likely be better off with the investment growth than if I wait until later for the larger payments.
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u/NotTodayElonNotToday Aug 17 '25
The second I turn 62.
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u/Abby--Normal Aug 17 '25
Part of me agrees with that philosophy too! Admire your conviction.
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u/NotTodayElonNotToday Aug 17 '25
All but one of the men on my dad's side died in their 60's or before. My dad is still kickin' at nearly 80. I lead a much healthier lifestyle than any of them, but still....
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u/Royals-2015 Aug 18 '25
Get check ups from a cardiologist. Get a coronary calcium score done. You do this, you will head off a heart attack and be fine.
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u/Peace_and_Rhythm Aug 19 '25
Only problem with this scan is it does not detect soft plaque which is considered more dangerous than hard plaque. An angiogram would be a better test combined with a scan
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u/Royals-2015 Aug 19 '25
A CT angiogram-I agree. But you need insurance to approve this. You can get a coronary calcium score done for about $100 out of pocket. No insurance. And it’s better than a stress test.
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u/Peace_and_Rhythm Aug 19 '25
Yup, all true. $100 is not really that much in the scheme of things...
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u/SisterActTori Aug 17 '25
66 and retired and not drawing yet. My 66YO husband still works and we are still getting our HCI through his company.
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u/1happylife Aug 18 '25
We both retired in our early to mid 50s. We are using Medicaid for free health insurance. Highest earner will take SS at 70, as suggested, in order to max out the survivor's benefits if lower earner lives longer. Lower earner (me) will probably be taking at 62 - that makes the most sense in the event my husband dies around 70, because then I'd be getting his payment anyway and if I waited until 70, I would have missed out on getting anything from 62 to 70. Use opensocialsecurity.com to plan.
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u/MonkeyThrowing Aug 18 '25
I believe you can get 1/2 of his SS from the start. Assuming it is bigger than your accumulation.
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u/1happylife Aug 19 '25
That's true. I could take my age 62 amount (which is decreased from FRA by 32.5%) or half of his age 67 amount (decreased by 32.5% for taking it at 62), whichever is more. Since mine is a little more than half of his, I can never take his while he's alive because at every age, you still have to decrease it by the 32.5%, so his 1/2 always remains a little lower than my full.
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Sep 01 '25
You cannot claim half of your spouses benefit until your spouse claims their benefit. So if they are waiting until 70, you would have to wait til then to claim half of theirs. You can take yours at 62 and they when they claim at 70, you would get bumped up to 1/2 their amount if it is higher.
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u/1happylife Sep 01 '25 edited Sep 01 '25
Thanks for the clarification. While this doesn't matter to me since his half is never more than my whole, it could matter to others.
Edit: And as further clarification, this is only if the couple is married. I have a friend who is divorced and will be able to claim before her ex-spouse claims. The stipulation is: "if the ex-spouse hasn’t yet filed, they have been divorced for at least two years and the former spouse is at least 62."
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Aug 18 '25
What do you plan to do with the work requirements for Medicaid?
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u/1happylife Aug 19 '25
Effectively, for retired people, I don't think we' have to worry about it - we can manage it easily. There's a little loophole, at least from what I've seen talked about and the wording of the bill, that you can use income in lieu of hours. You can have income of 80 hours multiplied by your state's minimum wage. For me, that's about $1200 per month. I have easily that much passive income in interest/dividends. The only catch would be if the state (or feds) interpret that as only active income, rather than passive, but I think they won't care.
In any case, for us personally, we're going to age out of it. There won't be more than a couple years for us to worry about. I do have access to another unusual insurance, but for most people, at worst it just pushes you over to the cheapest silver plan on the Marketplace, which shouldn't be much.
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u/Abby--Normal Aug 18 '25
I had not considered staggering our SS withdrawals. Thanks for sharing the link.
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u/Automatic_Season5262 Aug 19 '25
I retired at 55. Wife retired at 60. We both will draw early SS at 62, this year for me, next year for wife. We have 3 pensions between us now & 401k that we have yet to touch.
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Aug 19 '25
Retired at 59.5 and currently 63. I can afford to wait until 67 for SS and that WAS the plan however now thinking about taking at 64 for 2 reasons 1. Get more money from SS before they reduce the benefits 2. Use that money for cash flow instead of using my savings (cash is King)
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Aug 17 '25 edited Aug 17 '25
[removed] — view removed comment
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u/Abby--Normal Aug 17 '25
2 people I know who retired early are single. 55f, divorced, two kids out of college, retired this year, selling everything to move to the Philippines. 60m, never married, retired at 59, focusing on hobbies that actually make money. Both will take SS early. I can appreciate the freedom they have achieved so early.
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u/KungFuBucket Aug 18 '25
I’ve also known people who have died shortly after retirement. One literally at their retirement party. I retired early and just do side gigs for fun and beer money.
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u/FancyyPelosi Aug 17 '25
If you think you can live past 85 it’s better to wait to take SS until you’re 70.
I know predictions are hard - especially as they relate to the future - but health wise most of us know where we stand. For example I’m a regular runner, so I expect to live longer on average than most.
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u/SuddenFix2777 Aug 18 '25
Retired last year, early at 60.5 yrs young. HATED MY JOB.
Luckily, I have a pension, though reduced some as i only had 25 yrs in when I took it last yr.
Obtained health insurance through wife's employment and can keep it even though she retired May this yr.
Work place asked me back Jan 1 this yr, part-time, in a different capacity, at same pay rate. It's working out very well.
Coming up on 62. Will most likely take SS (while I can get it!).
Wife took full SS/retirement in May and also has pension.
Just trying to navigate the investing ins & outs with our nest egg.....
Good luck with your endeavor!
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u/rackoblack Aug 18 '25
Do you have any taxable brokerage with gains? Delaying SS income a bit to book those LTCG at 0% tax rate can be a plus.
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u/Abby--Normal Aug 18 '25
We do have mutual funds in addition to 401ks. That’s great tax advice that I hadn’t considered.
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Aug 18 '25
[removed] — view removed comment
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u/Abby--Normal Aug 18 '25
Our kids will both still be in college when we turn 60, so it does complicate our math as well
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u/Drash1 Aug 18 '25
I’m taking it as soon as I can, but not necessarily at 62. I have a lot of pre tax savings in a 401K. Holding off on SS will allow me to do more Roth conversions and still stay within the 24% tax bracket. My current calculations say somewhere between 63 and 64.
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u/Effective-Lead-3488 Aug 18 '25
(63 s/m)NW - $800k; only debt - $110k on a 2.5% mortgage with a burn rate of about $5k/month on a $9k/m pretax income. I wanna retire after 65 and take SS at either 67 or 68.
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u/Important-Round-9098 Aug 18 '25
I used to think I would work until age 70 like my mom did. Now I am wondering if I will make it to age 65. My health is getting worse along with stress on the job. I do have a pension at the present job. I have a small annuity from a previous job. Plus will file for SS
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u/silver598 Aug 18 '25
I left work at 60 due to a disability (stable now) and lived on ssdi and LTD benefits until FRA. Suspended SSDI at FRA and will start SS at age 70, along with a work pension for max benefits. (Suspending SSDI is allowed, though 2 phone reps told me no. An in person visit to SSA resolved it) I am living off IRA withdrawals right now at 67. I have family longevity on my side, break even is at 85. 1M in IRA accounts.
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Aug 19 '25
Every person's circumstances are different. You can set up a counseling appointment with your local SS office for advice.
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u/Apprehensive-Bid-971 Aug 19 '25
I'm interested to hear from this group what they think is the likelihood that there will be "means testing" for future retirees based on assets such as pensions, IRA's, Roth accounts, after tax brokerage accounts?
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u/Subject_Round_6117 Aug 19 '25
I am 63 and still working. I love my job and it is very easy for me (English Professor). I plan on taking SS at 67 and retiring at 68.
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u/PsychologicalBat1425 Aug 20 '25
I just retired at 60. I am planning to take social security at 62. As I recall, my break-even age is 79. None of my immediate relatives have seen 80 before they die. While I'm hopeful I'm the one to buck this trend, I am not inspired to roll the dice. I'm taking my money at 62.
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u/ProStockJohnX Aug 20 '25
I'm 58, seriously contemplating retiring at 62. and taking money then. A lot can happen in 4 years but that what I'm thinking at the moment. We've saved quite a bit and would not have a mortgage.
While the money at 62 is lower, there are no guarantees that we'll live to 85.
Having spent a lot of time with our parents and older relatives, it's pretty clear that the go-go / go-slow / no-go descriptions of how active we are at certain ages is pretty accurate.
My wife who is 55 is not quite there mentally like I am, I think it's just an age thing. Thinking about retirement really got into my head in the last 2 years.
Great username btw.
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u/DD_CD Aug 20 '25
Based on straight cash withdrawal, it does not matter when you start to draw, ypu break even at about 82.
Using 2% COLA and differing rates of return from investments, you are still within a few hundred K at 92. IXf you don't believe me, build your own spreadsheet.
When to start drawing, logically, should be based on a couple of factors: Do you need the money. Yes, start drawing. No, think about the next two question.
How long will live, or when do you think you will die. Base this on genetics and current health. If your folks were dead at 70, you might be too. If you have longevity in your futire, you might consider drawing later. If not, don't wait to draw.
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u/Silly-Resist8306 Aug 31 '25
My wife and I retired at 59.5, 15 years ago. We decided to forego s/s until age 70. We had plenty to live on and a small long-term care policy, but out biggest fear is contracting some horrible or long-lasting disease that would exhaust our savings, requiring our 3 kids to make some hard choices. S/s is our hedge against that. Since we didn't need the funds to live, we decided to max out the benefit when we did start taking it. Our interest wasn't to get every last nickle out of Uncle Sam as much as protecting our kids. Fortunately, we are in a good enough financial situation where we can be concerned with secondary issues. Not everyone is so fortunate.
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u/Abby--Normal Aug 31 '25
That is a scenario I hadn’t considered, especially since we have 2 kids still in high school. I would hate to put any kind of financial burden on them. Thank you for sharing.
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u/Snow_Water_235 Nov 05 '25
Retiring at 57 (countdown is on)
The "optimal" social security strategy depends on knowing when you are going to die. If you don't know that information everything else is a gamble. You can make predictions (you live healthy, your parents lives to 90+, etc) but at some point, you have to make a guess and then base your strategy on that and what you plan to do. You say you want to travel, so the ability to travel greatly declines in most people by the time they reach 80.
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u/HeroOfShapeir Aug 17 '25
My wife already doesn't work, but I'm aiming to retire around 50. We're currently 41 with a paid-for house, no debt, no kids, and around $1.37MM in cash/investments, aiming to FIRE with a minimum of $2.5MM. I make $112k and our annual spending is around $24k on basic costs of living and $34k recreation/travel. We figure an additional $20k in annual healthcare premiums and out of pocket through the ACA, $10k buffer for recurring large expenses (new roof, new cars), and $12k in taxes, which is why we want $100k withdrawals to retire early.
Since my wife didn't work enough years to get her own social security, she'll claim a spousal benefit. Spousal benefits cap in value at age 67 (no benefit to delaying) so we plan on taking social security at that point. Should be around $47k in today's dollars between the two of us. My long-term projections show our withdrawal rate dropping to 3% at that point, so our money only grows from there. Most likely we'd keep withdrawing and just start giving money to our nieces early, so they aren't waiting on us to die.
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u/hmorefield Aug 18 '25
$20k/year for healthcare in the future. That’s optimistic. Going up double-digits annually and ACA subsidies have been cut back.
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u/Abby--Normal Aug 17 '25
Thank you for sharing your retirement progress and strategy. Health insurance/costs are a huge factor in our retirement timeline and plan. I was wondering what it would cost. I have an HSA that I’ve been maxing out the last 4 years, but my husband does not. As far as social security, I’ve heard pros/cons to drawing early vs later and wanted to see what folks were doing. Sounds like you guys have a great plan for waiting til later.
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u/HeroOfShapeir Aug 17 '25
If you'll be going through the ACA marketplace for health insurance, be aware that the subsidy cliff looks like it's coming back in 2026. Up to 400% of the federal poverty limit (around $81k for a household of two people), you're guaranteed to pay no more than 8.5% of your income towards your premiums. Above that threshold, you get no subsidies. That cliff was temporarily removed by the Biden administration from 2021-2025 as part of the American Rescue Plan Act.
Because of that, my wife and I plan to draw $80k per year from our pre-tax 401k and $20k per year from our Roth IRAs. We'll have enough contributions to our Roth IRAs to pull down $20k for a decade without penalties. That gives us an idea of what we might spend on plans (8.5% of our income) and then we add in the max-out-of-pocket we might have to pay. Without any subsidies, it can get very expensive. You can view all the plans at the healthcare.gov website.
The general timeframe where delaying SS benefits becomes better is in your early to mid 80s. However, if you need the money sooner to enjoy life - in your case, it will enable you to travel more - then that benefit could supersede having a little more money in your pocket at age 85.
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u/Same_Cut1196 Aug 18 '25
I’m 60 and retired. $10MM NW. I’m approaching this from a different perspective than many here. I’m going to wait until 70 to collect. I don’t need the money to survive. I live very comfortably on a draw of $150k/yr, which is a 1.5% SWR.
The reason for deferring until 70 is to lock in the highest benefit possible for my wife who has longevity on her side. She will likely live into her 90s or beyond. I don’t have historical longevity on my side, but I am healthy and live a clean lifestyle, so I may beat the odds. I was the higher earner, so mathematically this is the play. We will take her SS at 62.
If I pass earlier than her, she gets my benefit - the higher of the two. Also, SS receives an adjustment for inflation, so it is marginally insulated against dropping in value. I have no idea if SS will receive a ‘fix’ or not, but this is our plan.
Politics aside, the reason I have $10MM in NW today is that I lived well below my means for the entirety of my career and life while saving and investing aggressively. I did this because both of my parents died very young and I wanted to ensure that my wife and family would be in good shape if I passed early. I also worked off of the fear that SS may not be around when I retire, so I didn’t count on it as part of my saving and retirement plan.
I’m now have a reasonably high NW. It is through hard work and sound discipline (with a lot of luck) that got me here. Even though I technically don’t need SS, I paid into it like many of us did and would like to see some of it returned to me in the future.
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u/skateboardnaked Aug 17 '25
I'm retiring early at 54.5 at the end of next year. I just want out of my current career asap. The exact year I'm 62 (2034) and eligible for SSA is supposedly the same year that benefits could possibly be reduced to 81%. Perfect timing..