black people and money

Should You Get Your Social Security Early or Wait to Max Out Your Payments?

Should You Get Your Social Security Early or Wait to Max Out Your Payments?

by Mary Thorson

As a lot of workers near retirement age (and that varies depending on your year of birth, your profession, and how comfortable you are with the term “puttering”), the option to draw Social Security benefits looms as an option. When disgruntled with the politics in Washington, people might lean toward drawing early and often, to ‘get it before it is gone.’ By putting the pen to the paper to see what monthly sum is available at age 62 and what the monthly payment is if the full retirement age of 70 is achieved before drawing benefits, many workers opt to wait. For most singles and couples, the numbers show the maximized benefit over the course of retirement years results if the recipient(s) wait until age 70.

That’s all well and good, if your financial situation allows you to wait to age 70. Other factors weighing on the Social Security benefit decision include debt, the existence of pension or retirement investment plan benefits, the viability of ‘second career’ full-time or part-time work, and family and health circumstances. For some workers, drawing early may bring the greatest benefit[1]:

  • Scenarios to maximize a couple’s benefits, such as the lower-compensated spouse beginning to draw the spousal benefit at an early age rather than the full worker’s benefit, only work if both spouses have reached age 66;
  • A single worker who begins to draw smaller payments at an early age and lives past age 80 will receive more benefit than if he/she waits until age 70;
  • A single worker who does not have circumstances to hinder normal life expectancy and who has a secondary source of retirement income, such as a job or funds from a pension or retirement accounts, can delay payments to age 70 to derive the Social Security benefit growth of 8% guaranteed each year; and,
  • Married couples may be able to let one spouse (the higher earner) file for Social Security benefits early but suspend payment while the other spouse draws the spouse payment as a means to help finance expenses until they both reach age 70.

In any case, it is a prudent practice to visit the calculator at www.socialsecuritysolutions.com to run your actual numbers and determine the best solution for your retirement planning.



[1] Social Security: The Inside Story, A. Landis, December 2011

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