Are you rapidly approaching retirement age? Are you wondering when the best time to start collecting Social Security is for you? Well, you’re not alone. With the rules concerning Social Security changing yearly, it’s easy to get confused as to when you’re even allowed to retire and start collecting your money. Yes, I said your money because you worked hard all your life to be able to collect it. So when is the best time to start collecting Social Security? It depends upon your situation. In this article, we’ll look at who should start collecting their Social Security payments when they reach the age of 62, which is the earliest that you can.
So What Are My Choices?
When you choose when to collect your Social Security payments, you get three options. First, you can start collecting when you reach the age of 62. Second, you can start collecting at age 66 or 67, depending on when you were born. Third, you must begin collecting Social Security payments when you reach the age of 70 years old. The payment amount you receive is different at each age. At 62, you receive 75% of your benefit amount. At 66 or 67, you receive 100% of your benefit amount. If you wait until you reach the age of 70, you can receive 132% of the benefit amount. This seems pretty straightforward at first glance, because most of us would assume that you should wait until you reach the age of 70 to start receiving payments because you’ll get more each month, right? Not necessarily. Playing the Odds According to the Social Security Administration, “...early or late retirement will give you about the same total...benefits over your lifetime.” But how can this be true? …show more content…
If your monthly checks are larger, you should make more money, right? Only if you beat the odds. The average life expectancy for Americans is 81 years right now. That means that most of us will live between 77 and 84 years total, with many dying before then. A relative few will defy the odds and live longer, into their 90’s. Whether you choose to collect your Social Security at age 62, 67, or 70, by the time you reach the age of 81, your total dollar amount collected will be almost exactly the same. The Social Security Administration uses advanced statistical data to calculate the payment amounts, and like a casino the odds usually turn out in their favor. Let’s take at three examples of people who retire at each age, and live to be 81. We’ll just use $1,000 as a full benefit amount for easy math. Example 1 Retirement at age 62, monthly payments of $750, 19 years = 228 payments …show more content…
To beat the casino (SSA) in this game, you need to wait until age 70 to collect your benefits, and live to be 95 or 100 years old. At that point, your total amount collected will be much larger that retiring early and collecting a smaller amount over a longer period of time. What does all of this mean? You need to evaluate your health when you approach retirement age and make a realistic estimate of how long you think you might live. Take into account your family’s health history and try to be realistic. For the vast majority of people, it’s probably best to start collecting benefits at the age of 62 to collect the most
So What Are My Choices?
When you choose when to collect your Social Security payments, you get three options. First, you can start collecting when you reach the age of 62. Second, you can start collecting at age 66 or 67, depending on when you were born. Third, you must begin collecting Social Security payments when you reach the age of 70 years old. The payment amount you receive is different at each age. At 62, you receive 75% of your benefit amount. At 66 or 67, you receive 100% of your benefit amount. If you wait until you reach the age of 70, you can receive 132% of the benefit amount. This seems pretty straightforward at first glance, because most of us would assume that you should wait until you reach the age of 70 to start receiving payments because you’ll get more each month, right? Not necessarily. Playing the Odds According to the Social Security Administration, “...early or late retirement will give you about the same total...benefits over your lifetime.” But how can this be true? …show more content…
If your monthly checks are larger, you should make more money, right? Only if you beat the odds. The average life expectancy for Americans is 81 years right now. That means that most of us will live between 77 and 84 years total, with many dying before then. A relative few will defy the odds and live longer, into their 90’s. Whether you choose to collect your Social Security at age 62, 67, or 70, by the time you reach the age of 81, your total dollar amount collected will be almost exactly the same. The Social Security Administration uses advanced statistical data to calculate the payment amounts, and like a casino the odds usually turn out in their favor. Let’s take at three examples of people who retire at each age, and live to be 81. We’ll just use $1,000 as a full benefit amount for easy math. Example 1 Retirement at age 62, monthly payments of $750, 19 years = 228 payments …show more content…
To beat the casino (SSA) in this game, you need to wait until age 70 to collect your benefits, and live to be 95 or 100 years old. At that point, your total amount collected will be much larger that retiring early and collecting a smaller amount over a longer period of time. What does all of this mean? You need to evaluate your health when you approach retirement age and make a realistic estimate of how long you think you might live. Take into account your family’s health history and try to be realistic. For the vast majority of people, it’s probably best to start collecting benefits at the age of 62 to collect the most