When to file for Social Security at FRA while still working full-time - born in 1958

Thanks for the clear explanation! I've been so confused about the earnings test. That's a huge relief to know it won't apply once I hit FRA. I think I'll definitely file 3 months before my FRA date. I've thought about waiting until 70, but honestly, I'd rather start collecting at FRA and invest some of it myself. My health isn't the greatest (though not terrible), so I'm leaning toward the 'bird in hand' approach rather than waiting for the larger amount at 70.

The tax situation is a really important point! Up to 85% of your Social Security benefits can become taxable depending on your combined income. Might be worth talking to a tax professional before you make your final decision, especially if you're still earning a high salary.

This is correct. Social Security benefits are paid in the month following the month they're due for. So for example, if your FRA is in November, your November benefit would be paid in December.

Thank you for the tip! I've been dreading the phone calls to SSA. I'll check out that service if I need to speak with someone directly. Did the agent give you any other insights about collecting at FRA while still working?

Yes, she mentioned that continuing to work might actually increase my benefit amount through something called "automatic adjustments." Basically, if my recent earnings are higher than some of my earlier years, SSA will automatically recalculate and adjust my benefit upward. No need to request it - happens automatically.

While I understand your perspective, the break-even age varies widely based on individual circumstances, benefit amounts, and tax situations. It's not a one-size-fits-all decision. For some people with longevity in their family and adequate current income, waiting makes mathematical sense. For others, taking it earlier is the right choice. Personal factors like health status, other income sources, and financial needs should drive this decision rather than general rules.

That's an excellent point I hadn't considered. My wife is 3 years younger than me and has a much smaller benefit based on her own work record. I should definitely factor this into my decision. Thank you for bringing it up!

I've worked and paid into Social Security my entire adult life, so I should definitely have enough credits. I believe you need 40 credits (10 years) and I've been working and paying FICA taxes for over 40 years now.

Yes, Medicare eligibility begins at 65 regardless of your full retirement age for Social Security. However, if you're still covered by a qualifying employer health plan (from your current employment or your spouse's current employment) at a company with 20+ employees, you can delay Medicare enrollment without penalty. You'd qualify for a Special Enrollment Period once that coverage ends. But if you're not covered by qualifying employer insurance, you should sign up during your Initial Enrollment Period around your 65th birthday to avoid late enrollment penalties.

Thank you so much for catching that timing error! You're absolutely right - I was getting confused about when to file versus when benefits would start. So I should be filing around April 2025 for benefits to begin in July 2025 when I reach my actual FRA. This is exactly the kind of detail that could have caused problems if I'd gotten it wrong. I'll definitely keep monitoring my Social Security statement too. It's encouraging to know that continuing to work might actually increase my benefits automatically. Really appreciate everyone's help in working through all these details!

That's a really good point about the 401k match! I hadn't thought about how collecting Social Security might psychologically make someone think they're "done" with retirement planning. You're absolutely right that employer matching is still free money that shouldn't be left on the table. Regarding disability benefits, I appreciate the suggestion but I think my health issues are more in the "aging normally" category rather than anything that would qualify for disability. Still, it's good to know that's a separate system I could look into if things change. Thanks for sharing your similar experience - it's reassuring to know others are navigating the same decisions!

This is incredibly helpful advice that I hadn't considered at all! The RMD situation at 73 is definitely something I need to factor into my planning. I do have substantial traditional 401k balances that will eventually force distributions, and you're right that having full salary + Social Security + RMDs all hitting at once could push me into a much higher tax bracket. The Roth conversion strategy for those gap years (67-72) makes a lot of sense. I'll definitely need to run some numbers with a tax professional to see how much I could convert each year without jumping into higher brackets. And thank you for mentioning the "do-over" rule! I had no idea that existed. It's reassuring to know there's a safety net if I realize I made the wrong choice within that first year. Do you have any rough guidance on what income levels typically make Roth conversions most beneficial during those gap years?

The income thresholds for optimal Roth conversions vary by filing status and change annually, but as a general rule of thumb, you want to stay within the 12% or 22% tax brackets if possible. For 2024, that means keeping your total taxable income (including the conversion amount) under about $95K for married filing jointly or $47K for single filers to stay in the 12% bracket. However, since you'll be collecting Social Security, remember that the conversion income could push more of your SS benefits into taxable territory (the "tax torpedo" effect). This makes the calculation more complex than just looking at ordinary income brackets. I'd strongly recommend modeling different scenarios with tax software or working with a fee-only financial planner who can run projections. They can help you find that sweet spot where you're converting enough to reduce future RMDs but not so much that you're paying unnecessarily high taxes today. The key is being strategic about it rather than just converting a fixed amount each year without considering the total tax picture.