Q: I have $150,000 in an inherited IRA. Would it be better to withdraw $50,000 and pay off my 5.5 percent mortgage or leave it invested in mutual funds and bonds inside the IRA? — D.D., Altamonte Springs
A: Leaving the money in the IRA allows it to grow in a tax-deferred vehicle. If you take the money out, you will have to pay income tax on the distribution. Since you have funds allocated among mutual funds and bonds, you might be better off on an after-tax basis leaving the funds in the IRA. — Paula Taylor
Q: My first husband died when I was 45. We were married for 26 years. I will be married to my second husband 10 years in 2011. I will be eligible for Social Security in June 2012 at which time I will be 62 and will draw a lesser amount.
I do have enough credits on my own and would receive about $575 each month. Can I claim on my first husband's Social Security or could I claim my recent husband's benefits and perhaps receive more than this? What documents would I need to take with me? — R.F.S., Apopka
A: According to Social Security's electronic booklet on survivor's benefits, you cannot generally get widow's benefits if you remarry before age 60. However, at age 62, you may get benefits based on your new spouse's work. Since you plan to take early retirement at the same time based on your own work, I think it is worth your time to contact a Social Security office and have a representative confirm if this is your best course of action.
You can also call Social Security toll-free at 800-772-1213. — Richard Almeida
Q: Dianne Webb's answer to the Social Security question seems to be in contradiction with the information that is provided annually to each wage earner. The information on the back of the "Your Social Security Statement" labeled "Receiving benefits while you work" states that individuals who continue to work, are collecting Social Security, and are not at full retirement age will have their benefits recalculated at full retirement age. — J. K., Orlando
A: I apologize for not communicating my answer well. The calculations required when a person begins receiving Social Security early are complicated. Some of those factors include: the number of months until full retirement age; if you are continuing to work and make over the limit; and if months of benefits are missed. If you begin receiving benefits earlier than retirement you will most likely never receive the maximum amount that you could have if you had waited until full retirement age.
But all the above mentioned factors are used to recalculate your benefits. There is a possibility that the new benefit could be higher than the original calculation, especially if you earned higher wages than in one or more of your 35 years used in the original calculation. Contact Social Security to get your specific benefits calculated. — Dianne Webb
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