If you are retired at age 62 and receive income from a 401k - can you collect social security?

Answer 1

Social security permits a qualified individual to draw early retirement benefits at age 62. Money received from qualified retirement plans (like a 401(k) plan) or from unearned investment income do not affect social security benefits. If you work and receive wages prior to your normal retirement age, then your benefits will be offset.

Early retirement benefits, from social security, are less than the amount that you would be eligible for if you worked until your normal retirement age. The reduction in benefit levels is permanent, meaning that they will not go up when you reach normal retirement age. However, they will be adjusted for inflation.

Answer 2

Buy some software for 2012 and run your 2013 numbers for various scenarios through it. The 401K payments will have withholding, not tax. The amount will now default to 10%, because you won't be subject to the 10% penalty. However, You will still have income. If 401K withdrawal is $0 and you are single, none of your SSA benefits would be taxable. If you take SOME money out of the 401K, the SSA benefits stay tax free. But, once you get past 1/2 of the SSA benefits plus 100% of the other income gets past $25K, part of the SSA becomes taxable. Take out a lot, and up to 85% of the SSA benefits are taxable. That means if you take, say, get $20K in SSA benefits and $50K in 401K to pay off your house, you will have taxable icnome of $67000 of income and that would put some fo the tax in the 15% tax bracket...which means the withholding of 10% wouldn't be enough.

Answer 3

The distribution from 401k is not counted as income towards your social security earnings limits. No worries!

Answer 4

Yes. Most people wait until age 65 for social security but if you need it now, go for it.

Answer 5

Yes. Social security payments are yours...you paid into the social security program!

Answer 6

Yes but no Medicare until you turn 65

Answer 7

yes