One of the biggest question facing those due to retire within the next decade is when to begin taking Social Security benefits. Social Security has proven to be one of the most important public programs in the United States, with many people depending on the benefits they have earned to bridge the gap between what they have saved for retirement and how much they need for living expenses during their retirement years.
When you decide to start taking the benefits can have a considerable effect on the amount that you receive in your monthly checks from the Social Security Administration. Here are some tips that will help you decide the best time to start taking your Social Security benefits.
The proposed retirement age for taking Social Security benefits currently ranges from age 62 to age 70. People that take their Social Security benefits before the age of 65 receive a lesser amount each month because they are expected to receive benefits longer due to increased life expectancies.
According to the Social Security Administration, 37 percent of people take benefits at 62, as soon as they are eligible. If you take Social Security before full retirement age, you lock in a 25 percent reduction for the rest of your life.
If you can wait until you are 70 to begin taking your Social Security benefits, you could nearly double the amount of your monthly check. Waiting until age 70 gives you an additional 32 percent boost in monthly benefits, or roughly 8 percent higher for each year that you wait.
Waiting until after the age of 70 to claim your Social Security benefits does you no good because 70 is the age where the calculations cut off. Currently, only about 3 percent of eligible recipients wait until age 70 to claim their benefits.
While waiting until you have reached the age of 70 to claim your Social Security benefits is optimal, there are some good reasons to start taking your payments earlier. If you have not saved enough for retirement during your working years, you may need those benefits to maintain your current quality of life. Other situations regarding health, job status, and family matters may also make taking Social Security benefits before the age of 70 the better solution.