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Explorer ○○○

Why not change the definition of "Full Retirement Age"? And have an easy chart?

To get the maximum SS benefit, you would wait until 70 years old.  Along the lines of why do we drive on a parkway, and park in a driveway...why does the SSA still say 66/67 is "full retirement age" but the full/max benefit is at age 70?  I know there is a calculation if you work after FRA and collect a paycheck with SS reduction, but that could be reworded.  Why not just cut to the chase, and say "Full Retirement Benefit Age is 70."   On the SSA site, instead of having to fiddle with different dates to estimate different ages...why not just have a list once you log in.  Show that if you retire at 62, 63, 64, etc. up to 70, here are the amounts.  Until you actually sign up, it is all an estimate anyway, due to earnings fluctuations, etc.  This would very simply let you look at the balance of what you could get and when you will want to stop working.  

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Frequent Contributor

Re: Why not change the definition of "Full Retirement Age"? And have an easy chart?

At FRA gets 100% benefits. FRA can vary by year of birth.

From FRA to 70, you get extra for delaying and % are defined.

From 62 to FRA, you get less and % are defined.

Government agencies have their way of doing things.

My issue is why Social Security truncates [it calls it rounding-down that is just bad] and not round properly. One guess is that some of its very old legacy computers can only do truncation.

YBB
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Explorer ○○○

Re: Why not change the definition of "Full Retirement Age"? And have an easy chart?

YBB, I know all that...my point was regardless of how it is worded...maximum benefits are at 70.  Why not just say THAT is "full retirement/benefits" age?  Much clearer.  If you file at 70 you get the max.  Anything earlier, you get less.  Have a list/table showing what you get on your birthdate at each age 62-70.  Much simpler.

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Participant ○

Re: Why not change the definition of "Full Retirement Age"? And have an easy chart?

It is not so simple because the benefit amount at Full Retirement Age affects more than the benefit amount for the person.  For example, the benefit as a spouse cannot exceed one-half of ones spouse's full retirement amount.  Extensive changes would have to be made to Social Security regulations and systems.

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Explorer ○○○

Re: Why not change the definition of "Full Retirement Age"? And have an easy chart?


@Lefty wrote:

To get the maximum SS benefit, you would wait until 70 years old.  Along the lines of why do we drive on a parkway, and park in a driveway...why does the SSA still say 66/67 is "full retirement age" but the full/max benefit is at age 70?  I know there is a calculation if you work after FRA and collect a paycheck with SS reduction, but that could be reworded.  Why not just cut to the chase, and say "Full Retirement Benefit Age is 70."   On the SSA site, instead of having to fiddle with different dates to estimate different ages...why not just have a list once you log in.  Show that if you retire at 62, 63, 64, etc. up to 70, here are the amounts.  Until you actually sign up, it is all an estimate anyway, due to earnings fluctuations, etc.  This would very simply let you look at the balance of what you could get and when you will want to stop working.  


SS benefit is not reduced by earned income after FRA.

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Frequent Contributor

Re: Why not change the definition of "Full Retirement Age"? And have an easy chart?

      Remember everyone should realize there is a household or family monthly max in play. Instead of Roth conversions, which turned out to be at a higher tax rate then now, we took TIRA money as supplemental income at the same tax rate as conversions would have been starting at age 60 and ran up our SS family max to within 100/month. Now in retirement we receive about 1k a month more in SS hopefully for years which we viewed as more sure income then depending on Mr. Market or any tax savings. So full retirement meant reaching the family max ASAP. Our definition was whatever we wanted it to be. Current nomenclature might mean at FRA you are eligible to earn as much income as you wanted without forfeiture of current SS benefits. Nothing to do with the maximum family (or individual) benefits which we concentrated on.

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Contributor ○

Re: Why not change the definition of "Full Retirement Age"? And have an easy chart?

The personalized information you want is available online in your SSA Statement. Read link for further details about establishing and using SSA online account.                                                                                                                                                                     https://www.moneyunder30.com/social-security-statement

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Explorer ○○○

Re: Why not change the definition of "Full Retirement Age"? And have an easy chart?

To Lefty

My understanding (and I have seen it multiple times in SS columns by former SS personnel) is that the "extra" you get by delaying until 70 is really recovering what you gave up by not starting with FRA. The design/intention was that sometime in your 80's your total accumulated payments would be the same irrespective of your starting age. In a sense it is as though the SS administration is taking what you would have gotten if you started at FRA and invested it for you then  gives you the whole thing at age 70 but not as a lump sum. If having delayed you die then the not taken payments are gone, your surviving spouse will only get benefits based on what your benefits would have been at FRA.

Obviously there are some "wrinkles" in the system, e.g if you have other income and can afford to delay, your spouse may/may not want to wait to start drawing against your benefit,  a substantial difference in the ages of you and your spouse, the possibility of you continuing to work (and pay into SS) until you are 70. So each person's situation is a little different.

But to summarize, my understanding is that FRA is aptly named, waiting to age 70 can increase your monthly benefit but not necessarily your total lifetime benefits. In fact it might decrease them.

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Participant ○○○

Re: Why not change the definition of "Full Retirement Age"? And have an easy chart?


@Lefty wrote:

YBB, I know all that...my point was regardless of how it is worded...maximum benefits are at 70.  Why not just say THAT is "full retirement/benefits" age?  Much clearer.  If you file at 70 you get the max.  Anything earlier, you get less.  Have a list/table showing what you get on your birthdate at each age 62-70.  Much simpler.


I get your point and I don't disagree, per se.  

However, just changing the wording would be much, much worse.  

Just think about all the helpful articles and official documents that would be obsolete or need to be changed.  It would lead to unnecessary confusion (and worse) poor decisions by taxpayers.  Best to leave things as they are.

ctyankee

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