Sue - That would be the best scenario if we could take/roll-over a lump sum tax-free/deferred, but there was no mention of anything like that in the paperwork we received. Well that is something that they would not have to disclose to you, imho. If they hand the distribution to you, it is entirely up to you what you want to do with it. The safest way would be to have an account set up (like a new IRA) and have the funds moved directly into the account, as opposed to you receiving the money and then you putting the $$ into the IRA. If they mail you the lump sum, they are required to withhold the tax on it. If it is rolled over into a qualified IRA account, then no taxes would be withheld at that time on the entire $21K, but would instead be taxed upon withdrawal, when you became 'withdrawal' age. It sounds like you are all familiar with all the above though..sorry if I was preaching to the choir. Good luck! Keep us posted please. Sue Here is a link that might be useful: 401k and Pension Lump-Sum Rollover Assistance

That's exactly what I thought, kudzu. You refuse to accept the math simply because you don't trust the government. That's fine if it makes you feel good because, you think, you've managed to outsmart those sneaky old federal bureaucrats. I sincerely hope you're enjoying your retirement and the SS checks you've been receiving for these past years . What bothers me is that you're misleading others with bad advice about something that's very important for their futures. For example, you claim that the math is so complicated that neither you nor I can figure it out and that the breakeven point may somehow really be later than 78 because of "the time value of money" -- the fact that a dollar today is worth more than a dollar some years down the road. That's certainly true but a deferred SS benefit grows at the guaranteed rate of 7% interest each year for four years -- the rate is 8% for those who hold off four more years until they're 70 -- PLUS whatever rate the COLA is for that year. COLAS have averaged 2.5% for the last 10 years, BTW. Since the deferred benefits is larger each year, the COLA on the growing benefit will also be larger than the COLA for the static early benefit. Considering that, the real breakeven point is probably somewhat less than 78 years not more. The real truth is that the government knows that, no matter what it tells people about waiting to take SS, most (about two-thirds) will take it as soon as they can. Many of them have no choice because they truly need the money. Others may have serious medical problems that are likely to shorten their lives. But many just can't wait to finally get something back from SS after paying in for so many years. Or they're afraid SS will run out of money. Or, like you, they refuse to believe that the government's advice to wait could possibly be true. Of course, each one of the 66% who start taking at 62 costs the government less in lifetime benefits than any and all of those who hold off. The relatively few who hold off until 66 will cost it more and the even fewer (like me) who hold off until 70 will cost it the most. That's why the breakeven point can be set at a lower age than actual life expectancy. The majority who take early collectively create a large enough surplus to fund those of us who hold off taking until later. So I thank you for the contribution, however tiny, you will likely make to help fund the later stages of my retirement.

From what I have read, the maximum payment for a worker at full retirement age (66, in this case) is $2346. However, each person's benefit is based on his own work record. The average payout is actually much less. A spouse has the option of taking the amount of: her/his own benefit or if less than the percentage based on the spouse's income, taking that amount. Basically if the husband's benefit at full retiremnt age is 1000, the wife would be entitled to an amount of 500. If she worked and her benefit from working is greater than 500 she would draw only her benefit; if her benefit amount is less than 500, then she would draw her amount (say 375)plus an amount to equal the 500. If she hadn't worked, she would be entitled to the 50% amount of her husband's benefit. This does not reduce the husband's benefit. The percentage is based on full retirement age; and the percentage is reduced for each year less than full retirement age. That is not the maximum family benefit, which is based on a widow/widower with minor or disabled children. Per SS site: "The benefit amount you and your children receive is based on your deceased husband's earnings. The more he paid into Social Security, the greater your benefits will be. However, there is a limit to the amount of money that can be paid each month to a family. The limit is normally referred to as the "family maximum." This limit varies, but it is generally between 150 and 180 percent of the deceased's benefit amount. If the sum of the benefits payable to you and your children is greater than this limit, each of you will receive a benefit amount that is proportionately reduced" socialsecurity.gov has many Q & A's Here is a link that might be useful: SS Benefits spouse

I'm not retired yet, but I'm getting close. I anticipate retiring at age 55. We've planned carefully, and we expect things to work out like this: Early retirement years: With our house and cars paid for, my pension will cover the bare-bones of our month-to-month needs. I will have my basic medical paid, and I will be able to cover him (at cost). We will be eleven years too young for Social Security. We intend to work either part-time or seasonally rather than dip into our savings too early. For example, if I substitute teach 8 days a month, I'll have as much money as I make now. We're also interested in "fun work" such as working at the seasonal Renaissance Faire. We have plans for travel and other such things in these years. We are not against using our savings at this point, but we want to do it sparingly /want to see that money continue to grow for later years, when we may need it more for medical issues, and we may see inflation eat into our spending power. Middle retirement years: 67 is full retirement age for both of us, and we're operating on the assumption that we'll begin collecting Social Security at 67. With two Social Security checks, we stop any part-time work in which we've been involved, and we will have more money than we are spending now ... and we won't have withdrawn much from our retirement savings. Later retirement years: Looking at our ages and health, this probably means just me. I'm assuming his Social Security will be gone, and we are assuming that inflation will hurt the value of my pension ... so it may not be enough to cover my basic needs at this point, especially because I may be paying for house cleaning, etc. -- things that I won't need to pay for in early retirement. However, at this point it'll be fine for me to dip into our savings. We have calculated the above general thoughts using real numbers, and we feel confident about financial security in our retirement years. Our biggest concern, of course, is medical needs. Regardless of what was taught, any teacher should use correct spelling, punctuation, and sentence structure. I do agree that anyone who teaches should be able to write well; however -- in my experience -- it's the elementary teachers who come across worst in terms of the written word. All retirement programs that cover governmental employees (at any level of government) are funded by taxpayers. Did you mean something else? False, but not entirely false. I'm a state employee. When I retire, I will have contributed 8-10% of my salary to the state pension fund for 30 years. That money has been invested and has grown. The taxpayers won't be funding my retirement; rather, the state will be returning my own investment to me. HOWEVER, a pension is a defined benefit program, which means I cannot outlive my investment. If I retire at 55 and live only 5 years, the state wins ... they get to keep a bunch of my money. and I'd die unhappy knowing that I couldn't leave that money to my kids. On the other hand, if I live to be 105, my money will run out, and -- yes -- the taxpayers will kick in for my later years. Actuaries work on these numbers, and they predict how long the average employee will live -- and that's how they decide how much to withdraw from our paychecks. On average, people will live just about long enough to "make back" their own contributions plus interest earned. I'm fine on retirement funds and withdrawing 3.8% per year. I'll take SS at age 62 since there's no reason not to and will leave me more disposable income. Well, there is one reason not to take SS at age 62: For every year you take your benefits early (early meaning prior to your full retirement age, which is probably 67), you sacrifice 6% of your benefit. To say it differently, if you could collect $1500 at full retirement age ... and instead you take it five years early (at age 62), your monthly benefit would only be $1050 ... that's a great deal of income to give up for the rest of your life. Obviously, I made several assumptions in that equation, but consider exactly how much that 6% per year would be for you personally.