I will be 66 on 8/11/18. I will have w2 income of 32K and passive income of 10k prior to that date. I anticipate continue to work at the same income level for many years. I have done the math and am making the decision to take retirement at 66 rather than wait until 70. Question becomes. When and how do I contact SS to initiate retirement payments. Should i wait until January 2019 to begin collecting SS to avoid any income penalty?

Hi,

You can draw benefits starting for August 2018 regardless of how much you will earn this year, so there would be no 'income penalty' other than the fact that you may have to pay income taxes on a portion of your Social Security benefits (https://www.ssa.gov/planners/taxes.html). In fact, if you won't be earning more than $45,360 by the end of July this year, you could start drawing your benefits now if you wanted to. However, that would result in your receiving a slightly reduced benefit rate (i.e. a little over 1% less than your full retirement age rate if you start drawing effective with June).

When to start drawing benefits is a personal choice, but you may well have better options available to you. Before filing, you should very strongly consider using our maximization software to explore and compare your options to make sure that you fully understand all of your choices.

Best, Jerry