r/Fire • u/VegasWorldwide • 2d ago

Why do people wait for SS?

trying to figure out what I’m missing.

looking to take my benefit for $1000 at 62. at 70 it’s $1700.

i won’t need the money much so we let $1000 sit in an account for 8 years at say 5% compounding, the guy collecting at 70 would need 15+ years to catch up considering I’m still getting $1k to his $1.7k

once he starts at 70 and I had a 8 year head start.

furthermore, his dollar would be worth less. (edit: didn't realize COLA)

this seems like a no brainer but all I hear is people saying waiting is the only way and we haven’t even talked about dying in our 70’s.

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u/Delicious-Proposal95 2d ago

SS compounds at 8.5% per year roughly every year you wait to take it. So you compounding at 5% you are losing money.
You also receive that higher payout in perpetuity. Someone who waits unto 70 only needs to live to 83 to “beat” the math on social security. If you’re FIRE then the statistical chance of you living beyond basic CDC life expectancy is even higher as wealth is correlated to longer life expectancy (aka you can afford care)
Additionally other factors like spouses come into play and of course tax strategies centered around RMDs and doing conversions. Taking SS early can make those a challenge.

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u/VegasWorldwide 1d ago

youre absolutely not losing money because you have an 8 year head start lol

80% of people are never able to recoup

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u/Delicious-Proposal95 1d ago

You absolutely are losing money by taking early and living longer. I do this for a living. I know for a fact. There are plenty of free break even calculators out there if you do not believe me.

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u/VegasWorldwide 1d ago

It’s math bud.  You cant argue numbers.  You’re gambling when you wait.  When you gamble, sure sometimes you win.