When to take Social Security to maximize your benefits
Many people ask when they should start taking Social Security because there’s a bigger monthly check the longer the payment is delayed. But waiting could lead to other questions, specifically regarding the political stability of Social Security.
You can choose to take Social Security at any time between 62 and 70. Those who wait until the full retirement age of 70 receive the full payout. Those who start at 62 are only eligible for 75% of the benefit. The percentage of full benefit changes with every year you wait.
“There are no redoes. When people take Social Security at age 62, they continue working,” said Alexander Joyce of ReJoyce Financial. “The issue with this is that they earn too much money.”
Until you reach full retirement age of 70, the Social Security Administration will deduct $1 from your benefit payments for every $2 you earn above the annual limit. The annual limit for 2023 is $21,240.
What Should I Consider?
Because this is a big decision, here are some factors to consider before you make your decision.
- Defer: Waiting until age 70 may allow you to pick up a compound delayed credit of 8%.
- Taxation and penalties: Rules for your income, such as Social Security, do not change with age. Being professionally informed is pertinent.
- Amount of money you need: Do you need the money now? Is this the right time to draw Social Security? Should I supplement my lifestyle by taking from my portfolio instead?
“Overall, avoid making emotional decisions.” said Alexander. “Most importantly, it is essential to have proper financial planning in place.”
Schedule your no cost, no obligation visit and gain professional advice with the financial experts at ReJoyce Financial today!