When should you
start collecting your Social Security benefits? Well, you can do so as early as
age 62 and as late as 70. There are upsides and downsides to starting
early or late.
Here's why it
might be worth passing up the advantages of starting late and instead claiming
your benefits at 62 or 63.
Do you expect
to receive about $2,000 a month if you start collecting at your full retirement
age (which is 66 or 67 for most of us)? Well, per the table above, if your full
retirement age is 67 and you wait until 70, you'll receive checks that are 124%
of $2,000 -- or $2,480. Over a year, that's $5,760 more, a meaningful sum. That
extra money is a bit misleading, though, as you'll see shortly.
Note, too, that
you can visit the My
Social Security site to find out just what benefits you can expect.
checks -- but fewer of them
It's true that
your Social Security checks will get bigger if you delay starting to collect
them. And it's also true that if you start collecting before your full
retirement age, they'll get smaller -- up to 30% smaller.
seems like reason enough to delay as long as possible. But for most of us,
waiting is probably not worth it.
Security Administration explains why, saying, "If you live to the
average life expectancy for someone your age, you will receive about the same
amount in lifetime benefits no matter whether you choose to start receiving
benefits at age 62, full retirement age, age 70, or any age in between."
while checks that start arriving at age 62 will be considerably smaller, you'll
receive many more of them. Starting at age 62 instead of 67 means 60 additional
checks. And starting at 62 instead of 70 means 96 additional checks. So
starting to collect at 70 doesn't offer most of us the windfall that it may
to plan on working until age 70 and start collecting bigger Social Security
checks then, because life often throws us curveballs. A heck of a lot of people
don't end up getting to choose when to retire.
Fully 48% of
retirees left the workforce earlier than planned, per the 2017 Retirement
Confidence Survey, with 41% of them citing health problems or a disability as
the reason; 26% citing changes at work, such as a downsizing or workplace
closure; and 14% having to care for a spouse, or other family member.
That should be
a wake-up call to save and invest enough so that you can retire
early if you have to. Or at least to get as close as possible to that. It's
also helpful to get and stay as healthy as possible, to reduce the odds of
health problems making you retire earlier than you want.
So, can you
everyone can retire early. But you may be able to, especially if you still are
a decade or two away and can sock money away aggressively. That's another good
reason to not start collecting Social Security at 70.
If you hadn't
thought about retiring early as an achievable goal, think about it now. The
sooner you retire, the sooner you can get to all kinds of things that you've
postponed until retirement, such as leisurely road trips, taking on a new hobby
such as woodworking or flying, or establishing that garden you've long dreamed
of. Early retirees often can enjoy retirement more, as they're younger,
typically in better health than they'll be later, and therefore more able to
travel, engage in recreational activities, and so on.
On the other
So for many of
us, it's clearly best to aim for a retirement that's as early as possible, and
to not plan to start taking Social Security at 70.
Still, it can
make sense to wait until 70 for some of us. If, for example, you can afford to
wait -- maybe because you're healthy, you enjoy your job, and you'd like to
keep working as long as possible -- go ahead. Another good reason: if many of
your relatives have lived to 90 and beyond, suggesting that you stand a good
chance of doing so as well. In that case, you can end up getting more out of
the Social Security program by waiting for those bigger checks -- because
you'll receive them for more years than you would with an average lifespan.
And if you're
married, delaying when you start collecting benefits can be part of a
sensible joint strategy. For instance, a couple might start collecting the
benefits of the spouse with the lower lifetime earnings record on time or
early, while the higher-earning spouse delays starting to collect.
That way, the
couple does get some income earlier, and when the higher earner hits 70, they
can collect extra-large checks. Also, should that higher-earning spouse die
first, the spouse with the smaller earnings history can start collecting those
bigger benefit checks.
The more you
know about Social Security, the more you can maximize your benefits. You may be able to get many
thousands of dollars more out of the program. While you're at it, look into
other ways to increase your retirement income.
here for the original article from Yahoo Finance.