Living Richly in Retirement-When Should I Access Social Security In Retirement ?

The big question facing many retirees is when to take social security in retirement. Since the “full retirement” age has changed to 70, the question has become more difficult for many people. It used to be that the advise from social security itself was to take benefits early(the take it while you can still enjoy it theory). Now they tend to advise people to wait, arguing that have more money per month later is important, especially as we live longer.

It’s a difficult question, and it seems to me that the answers cross the spectrum. For some people waiting til 70 makes sense. These folks most likely have large savings (the kind we’re all “supposed” to have) or else the ability work more years at a regular job.  For the rest of us, the answers will lie somewhere in between. Some folks will take Social Security in retirement early for fear of what may happen to the system later, others will take it out of need. Others will opt in for any one of many reasons.

In my case, I have taken social security in retirement exceptionally early. At fifty nine (about to turn sixty), I’m now eligible for my husband’s social security benefit. In theory, I could defer this, just as I could defer my own benefit for up to ten years.  I chose to take this social security in retirement benefit  as soon as I could for a variety of reasons. The first and most obvious reason was that due to some pretty horrible financial decisions (or lack of intelligent decision), I was operating with no savings and a thousand dollar pension.  Social security moves me from having nothing to having a moderate income-which I am still learning to manage in retirement.

Social security

Even without this circumstance however, I can see good reasons to take social security early, both for myself and for others.  Why?

Social Security In Retirement

  • It may be that taking social security makes more sense than increasing your annual “take” from savings and investments. If your “number” per year is too tight, social security may make the difference. Yes, you could also take more from savings. But if you believe as many do that in the end result you make money in the stock market, it may make more sense to leave that interest producing money where it is. At the moment I have no savings. but I hope to rebuild at some level, and I would like that money to be earning money for as long as possible.
  • Even if you are not on the edge, taking social security in retirement may enable certain extras. While most of us manage to cut expenses in retirement, there are those occasions where we could make use of that extra cash for the little things.
  • For most of us, expenses (other than medical costs) will lessen as we age. We’ll certainly be more interested in traveling at sixty five than at, say, eighty five.  This in no way implies that life is not full at eighty five, just different. As such, I prefer to have the extra income available currently.
  • For some, taking that money enables us to actually make life more stable later on.  While some retirees have homes paid off, upgraded, repaired and outfitted for later years, some of us are not there yet. If I am to retire in place, it makes more sense for me to use whatever income I have now to make my house manageable, insulate to decrease costs, add things like safety bars and security systems if i feel they are needed. Not only that, but it may be cheaper to do it now while am able to do a certain amount of labor myself.
  • We can always change our minds. I have returned to college with the goal of working at least part time as a translator. I also have a slowly blooming quilt business. Should those two options produce enough income for me, I can simply contact social security and defer payments until a later date.

Retirees who begin collecting Social Security at age 62 rather than at full retirement age should expect a 30 percent reduction in monthly income. At the age of 62, you can earn Social Security retirement benefits while continuing to work.As a result, waiting until you’re 67 to file will result in a higher monthly check.

There’s no such thing as a one-size-fits-all answer when it comes to determining the optimal age to begin collecting Social Security payments. It’s advisable to postpone if at all possible. Wait till you’re 70 years old if you’re in good health and don’t need extra money.

Financial decisions are unique to each family or person. This is true at any time of life.  While I realize the official “doctrine’ on social security is the opposite of what I have chosen, it works for me.  What about you-have you made a decision on social security?  How will you manage (or are you managing) that portion of your retirement finances.

Frequently Asked Questions

Is it better to take Social Security at 62 or 67?

Retirees who begin collecting Social Security at age 62 rather than at full retirement age should expect a 30 percent reduction in monthly income.

Can I draw Social Security at 62 and still work full time?

At the age of 62, you can earn Social Security retirement benefits while continuing to work.

What is the best age to take Social Security?

There’s no such thing as a one-size-fits-all answer when it comes to determining the optimal age to begin collecting Social Security payments.

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