I am 62 years of age and working part-time plus have been receiving pension after retiring from my old full-time job. After comparing the SS I can begin collecting at 62 vs waiting till full retirement, the difference would not be that great in waiting plus my wife says I should begin taking it at 62 since she is currently working now and will get more in SS when she retires at full retirement age in 9 years. I am thinking of continuing to take 4.5 % withdrawals yearly from my 401K but what would is the difference between that plan and taking out variable and/or fixed annuities for duration of my life and what would you recommend doing? I have done the Fidelity Income Strategy for retirement and this is where I’m at.
Terry Says: OK, this is not a subject for guesswork, and definitely not one for advice from your wife! Taking SS early is definitely not recommended, becausae waiting till full retirement age is the equivalent of gaining 8 percent per year! And that is the base on which you will get future cost of living increases. Not to mention that your benefits from starting early will be dinged because of your part-time income!
There is a perfect calculator for you at T Rowe Price — Here’s the link: http://individual.troweprice.com/public/Retail/Retirement/Social-Security-Tool?WTAFeaturedResult=social security calculator
It is designed to help both you and your spouse calculate the best time to take benefits, depending on your goals (which may including maximizing income, maximizing survivor’s benefits, or dealing with current income needs). Then, use their free Retirement Income Service (similar to the Fidelity service but with the benefit of incorporating SS) and come up with the best options for both SS and investment withdrawals.