At what age should I start taking social security benefits?
The short answer to this question is that it depends on your personal financial situation. When you retire, social security may be a big part of your retirement income. The social security system is designed to give you the most amount of benefits for each dollar that you pay into it.
At the age of 62, social security benefits are estimated to be reduced by nearly 33% for the rest of your life.
Deciding at what age to start receiving your social security retirement benefit is a big decision. Using the calculator on Social Security’s website provided eye-opening insight into what your benefits could be depending on the age you start taking benefits. If you begin taking social security at age 62, your benefits are estimated to be around 33% less than if you retire at social security’s ‘full retirement age’ of 66 years and 10 months. If you wait until age 70 to start taking your social security retirement, you can add an additional 31% to your monthly benefits.
For our example we used was someone born in 1960 and earning $75,000 per year. Using our example the full retirement benefit from social security’s ‘full retirement age’ of 66 and 10 months is $2,036 a month. If this person decides to retire at age 62, the monthly social security benefit would be reduced to $1,366 a month, nearly 33% less! On the other hand, if this person waited until age 70 it would be $2,656 a month, approximately 31% more! To estimate your social security retirement benefit at age 62, 67 and 70 click here.
Everyone’s financial situation is different. You may need your social security benefits and 62 to meet your financial needs. But, if you are able to delay taking your social security benefits, you will have more money per month when you do start receiving SSI retirement benefits.
The decision regarding at what age to start receiving social security benefits can affect you for many years. Choosing social security’s ‘early retirement age’ or social security’s ‘full retirement age’ can be one of the most important decisions you will make in your life.
Hazard & Siegel helps individuals and business people plan for their financial future. If you would like to discuss planning your financial future, call us to learn what sound financial planning can do for your wealth, and your retirement.