How does a person retire and start collecting social security? Does the individual themself send in forms claiming retirement or does the persons employer send them in after that person retires? I ask because I am wondering what happens to people who are forced to retire from their companies at 63 or 65 but who don’t want to start getting SS benefits until 70 due to the higher benefit rate at 70. do they just find another job and wait until 70 to file forms with SS?
You need to actively apply for SS benefits, so it’s not necessary to get another job if you retire before 70 but want to wait until then to receive benefits. Presumably, though, you’d have other money on which to live between 65 and 70.
Another option is they just stop working and live on the nestegg that they saved until the reach the age they want to start drawing social security. People that count on social security alone need to stop and consider their standard of living now versus retirement. Social security is meant to provide the very, very basics. It’s not a pension plan or traditional retirement plan.
Consider that at 63 wanting to draw at 70 means 7 years of most likely menial labor. Sure, I know people in this age group that do consulting and earn a very good living, but the majority of middle class people just don’t get prime jobs at this age – they work at Wall-Mart or CVS pharmacy and so on. Maybe it’s just to do something, or maybe it’s because they didn’t plan their retirement properly. Who knows? In any case, 30 hours per week at $6/hour doesn’t sound any better than taking the reduced social security benefit at the younger age, unless, as I said, there’s no nest egg and one must work to survive.
Please don’t drag this out of GQ – I’m doing my best not to say anything negative about social security. 
Even though i’m only 25 that sounds like a plan I was considering, just work part time starting in my 50s or so and don’t officially retire until 70 so my returns are 40% higher than if I retire at 65.
Actually SS can provide a good income from what i’ve seen. All my calculations show it providing 60-70% of pre-retirement income when you consider that expenses are different between the two.
Assume you make $50k a year pre-retirement. You put 10% into a retirement plan, so you now have 45k. Then you pay payroll taxes on that 45k (30%) so now you have 32k. Then you have a mortgage of maybe $500 a month so now you have 26k a year post taxes/mortgage/investment income. If you don’t retire until 70 you collect $2022 a month in SS benefits. At age 70 you will not put 10% of income into retirement anymore, your mortgage should be payed off and you will not pay payroll taxes on social security, so SS alone would provide 93% of your pre-retirement income (even though the actual numbers are only half at retirement you don’t pay payroll taxes, you don’t put 10% away into retirement funds and you don’t have a mortgage to pay off). Plus you’d have a 401k, plus you’d have equity in your house. My calculations could be missing something, but on the surface it sounds simple. But i’m sure medical costs will be 25% of GDP by the time I retire, damnit.
Ok, thanks. I just didn’t know if the individual sent in the forms or if the employer sent in the forms.
When you put money into a retirement plan it is pre-tax in the sense of income tax, but not in the sense of SS/Medicare payroll taxes. There is a whole elaborate order of deductions about what is exempt from what taxes when you factor in SS/Medicare, 401k, medical benefits, health care reimbursement accounts, etc. In simple terms, your whole check is subject to SS/Medicare tax, then you do the 401k, then income tax is withheld.
I don’t see this as a big flaw in your overall statement, although I’m not qualified to fully evaluate it.
Another important point is employer-provided health care coverage for retirees. It’s rare and becoming rarer, but it may still exist in some form when you retire, especially if you work for a government entity or large corporation. There are usually requirements based on age and years of service, such as age 60 or older with 15+ years of service, or age + service total = 75. Since these retiree medical benefits can be EXTREMELY valuable, this is often a factor in when people decide to retire.
Incidentally, in the US it is illegal to “force someone to retire” (with very limited exceptions such as pilots due to bonafide occupational qualifications like reaction time and vision). This was probably just a casual choice of wording on your part. However, I think what you are really describing is the sad fact that anyone can lose their job at any age. Again in limited circumstances companies may incent employees to early retirement with enhanced or accelerated benefits, and employees may be wise to take these offers. Incenting employees to retire may be an indicator the company is not doing well, and if the employeees don’t take the incentive when it’s offered they, like all employees, could face the sad fact of losing their jobs.
Take off your clothes, put on pajamas (or?), turn of the light, get in bed, pull up the covers, close your eyes, think of nothing, go to sleep.
:smack:
You were asking about SS retirement.
If you are now just 25 or so, come back in 40 or 50 years.
Haven’t you heard?
The rules are going to change and it will be a completely new game!
Most of the info I’ve read says SS will be fine until 2042 when it starts to only be able to pay 73% of benefits. I will be 63 in 2042 and if changes are made SS will probably still exist even after i’m dead.
**
Wanna bet on it?**
Yes, yes I would.
And BTW–large fonts for semi-hysterical screeds are my schtick, so quit biting my style. 
The risk to SS are grossly exaggerated by a dishonest Administration that wants to turn vast wads of dough over to the largely unregulated stock market.
So chill.
My rants about the risk of epidemic diseases like Ebola, SARS, orBird Influenza are actually better founded that the SS flap. And I’m an admitted hypochondriac.
Be sure to practice yelling at kids to stay off your lawn. Get in a solid two hours a day, perfecting the pitch and timbre. of your voice.
I can’t, im going to be busy playing chess in the park and watching the weather channel.
We are not going to have that debate in this forum. In the future you will confine your opinions about political dishonesty to the appropriate forums.
It appears that the factual question has been answered, so I’ll close this thread.
bibliophage
moderator GQ