Can You Wait to Take Social Security?

On Aug. 14, 1935, President Franklin D. Roosevelt signed the Social Security Act to help fight unemployment and guarantee income for retirees. While Roosevelt acknowledged the act’s limitations, saying, “We can never insure 100 percent of the population against 100 percent of the hazards and vicissitudes of life,” the goal was to prevent older Americans from living in poverty.

Many Americans now think that retirement automatically begins when they reach age 65. Not necessarily! While some can afford to retire at that age, others may need to work longer to save more. Regardless of when you want to stop working, you might want to consider delaying taking Social Security benefits if possible. 

People born between 1943 and 1954 are eligible for full Social Security benefits at age 66; however, they can begin claiming a lesser amount at age 62. Those who wait to apply for Social Security benefits until age 70 can receive up to 8 percent more per year, which could almost double their monthly benefit income.

You really want to avoid this worst-case scenario: those who claim their benefits before full retirement age but must return to the workforce later. Their benefit amount is reduced from claiming early, and then they risk having it reduced even further if they earn too much when they work again!

For those retiring at age 66 in 2023, the maximum Social Security benefit is $3,506 a month, but a person waiting to retire until age 70 in 2023 receives $4,555 a month! That extra $1,000 per month can make a big difference.

Why not test the waters and see if you’d be able to wait until age 70 to claim your full amount? Starting today, practice living on a retirement budget that excludes all Social Security benefits for at least six months. 

Instead of waiting until age 65 to decide what to do, take the time NOW to practice and examine your budget options so you can make the most of your benefits. Our office can work with you to explore your options so you can enter retirement at the time that works best with your budget. If you are wondering about your retirement benefits, please call or e-mail me today to schedule a review of your portfolio. I'm here to help you confidently transition from the workforce into retirement.