It’s arguably the hardest decision senior citizens will ever make: deciding when to begin taking their Social Security benefits.
According to the Social Security Administration (SSA), 62% of today’s retired workers generate at least half of their monthly income from the program, meaning a poor claiming choice could wind up costing them a lot of money. Unfortunately, there aren’t any concrete guidelines or one-size-fits-all tactics when it comes to taking your Social Security benefit, which makes the decision a combination of science and luck.
Most retired workers claim benefits early, but it can be a mistake
What we do know is that far more seniors choose to claim their retirement benefit earlier than later. Approximately 60% of all retired workers begin taking their Social Security payouts between ages 62, the earliest age possible to commence benefits, and 64. Meanwhile, just 1 in 10 workers waits until between ages 67 and 70 to begin taking a payout from the program.
To be clear, claiming Social Security early may offer advantages for certain retirees. If, for example, a retired worker was in poor health or had a chronic health condition, they may not live to the average life expectancy in the U.S. of 78.6 years. In this instance, taking their benefit early would allow for a greater probability of collecting a larger lifetime benefit (note the emphasis on the word “lifetime”).
Another example where taking…