Summary:
1. Signing up for Social Security at 62 may result in reduced benefits for life.
2. Waiting until full retirement age, or even until age 70, can increase monthly benefits significantly.
3. Delaying Social Security can also benefit your spouse by providing higher survivor benefits.
Article:
When it comes to making decisions about Social Security, it’s essential to consider all the angles. While the temptation to sign up for benefits at 62 may be strong, it’s crucial to weigh the long-term consequences. Filing at 62 can lead to reduced benefits for life, which may not be the best option, especially if you have limited retirement savings.
Financial experts often recommend waiting until full retirement age, which is 67 for those born in 1960 or later, to sign up for Social Security. By waiting, you can avoid reductions in your monthly benefits and ensure a more stable financial future in your senior years. However, you don’t have to claim benefits at full retirement age either. The Social Security Administration allows individuals to accumulate delayed retirement credits until age 70, resulting in an 8% increase in monthly benefits per year.
By delaying Social Security until age 70, you can secure a significant boost in your monthly benefits for life. For example, if you would receive $2,000 a month at full retirement age, waiting until 70 could increase that amount to $2,480. This additional income can provide you with more financial flexibility, allowing you to cover unexpected expenses or enjoy a more comfortable retirement.
Moreover, delaying Social Security can also benefit your spouse in the long run. If you pass away before your spouse, they may be entitled to survivor benefits based on your Social Security earnings. By maximizing your own benefits through delayed filing, you can ensure that your spouse receives a more substantial survivor benefit, providing them with added financial security.
Ultimately, the decision to claim Social Security is a personal one that requires careful consideration. It’s important to discuss your options with your spouse and possibly seek advice from a financial advisor. While delaying benefits until age 70 may require additional work or financial planning, the potential for increased benefits for both you and your spouse makes it a decision worth considering. By looking at the big picture and thinking about the long-term implications, you can make an informed choice that sets you and your spouse up for a more secure financial future.
