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AUTHOR: R Quinn on 5/14/2025
We have discussed many times when to start Social Security and pretty much concluded the decision is personal and need based. I don’t have a problem with any of that, but what bugs me is concern over breaking even considering amount received and years of benefits.
It seems to me the monthly benefit, the income when needed most is all that matters. Since I once again find myself in the minority, I asked a neutral party, Gemini AI. Here’s is the answer I received.
“The Social Security breakeven date is important because it helps individuals understand the long-term financial implications of when they choose to start receiving their Social Security retirement benefits.”
“The Social Security breakeven date is a valuable tool for retirement planning. It provides a financial benchmark to help you decide when to start your benefits to potentially maximize your lifetime income from Social Security based on your individual circumstances and life expectancy.”
What long term implications? Valuable for what? What financial benchmark? How could it possibly matter at all? You receive benefits you need and then somewhere along the journey they stop, breakeven or not.
Are you any better off going past breakeven or worse off missing the mark. Not that I can figure.
What do you say?
QUINNSCOMMENTARY 
Our Social Security rep who attended our pre-retirement seminars (attendees were mostly 50 – 55) would always respond to questions of whether to claim SS at 62 – “You tell me the month and day you are going to die and I will tell you what to do.” While I always laughed with everyone else, I had a simple equation for those retiring at or before age 62:
Otherwise, I always encouraged folks to test various ages, starting at full retirement age (then age 65), and adjusting for the time value of money and taxes, and at least two estimates each of longevity (for the individual and the spouse). Back then, I always assumed people wouldn’t commence SS or payouts of savings until they actually stopped working.
Then, whatever the timing the individual identified as optimal, I would always suggest that they consider using savings as a bridge to defer commencement of Social Security if they needed additional guaranteed, inflation-indexed income … before buying an annuity.
Simple, perhaps simplistic, perhaps too simplistic.
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Quinn, believe it or not I first saw the break even analysis over 45 years ago. It was given as an example to an innumerate person who argued they would be forever ahead 36 checks instead of waiting to 65. It was pointed out they would break even at 78 and receive higher checks during the time from 65 forward. It was a simple math example and not a retirement planning example. This was in simpler times before all the retirement planning industry took hold.
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