My plan for our retirement income needs was to rely on our pensions to pay the bills and draw from taxable savings for extra expenses. We delayed my wife’s Social Security payments until she reached full retirement age (66) and planned to delay my SS to age 70 — unless we needed the money. We still don’t need the money, however, I’m starting to consider starting SS earlier and investing the cash while stocks are getting pummeled. I’m 66 now.
The guaranteed 8% annual increase in SS payments was my primary incentive for delaying, but with a bear market underway, I might be able to match or exceed that percentage through my investments. We also have our IRAs and 401Ks to rely on, but I don’t want to start withdrawing from them until we have to meet required minimum distributions. I have been converting a portion of our IRAs to Roth accounts each year at a rate that doesn’t push us to a higher tax bracket. However, if I start drawing SS, that will push us from the 12% to the 22% bracket, so I’m still not sure that’s a good idea, even with depressed stock prices.