Social Security Age: You should carefully think about your choices because the age at which you start getting Social Security benefits will affect your monthly income for the rest of your life, especially if you plan to depend on them a lot when you retire.
Different people will have different ideas about what age is right to file a claim because it depends on their situation.
In one in-depth study, researchers looked at how retirees chose when to file their claims to find the “optimal” age.
How does your age impact your benefits?
It’s crucial to first comprehend the precise impact your age at the time of benefit filing will have on your monthly payments.
You must file at your full retirement age (FRA) to get the full benefit to which your work history entitles you. Everybody born in 1960 or later is 67 years old, though this age varies depending on the birth year.
If you file at age 62, you will have a benefit reduction of up to 30%. You can also postpone filing claims after your FRA. If you wait until you are 70 years old, you will receive a bonus of at least 24% monthly in addition to your full benefit amount.
These modifications are also irreversible. Except for yearly cost-of-living adjustments, your benefit amount is typically fixed once you start claiming.
According to USA today, in a 2019 study, United Income researchers looked at retirees’ claim decisions and then looked at their income for the remainder of their lives. They then utilized that information to ascertain the proportion of retirees who made the best decision to optimize their lifetime income.
The undisputed victor is 70 years old. Although only 4% of retirees file at that age, researchers discovered that 57% of study participants could have earned more throughout their lifetimes if they had waited until age 70 to file.
$4873 Social Security: Benefits, Requirements and Schedule
The data showed that filing before the age of 64 was the least advantageous age to file, with only 6.5% of retirees maximizing their lifetime income by filing at 62 or 63.
Additionally, filing at the ideal age has a significant impact. The researchers discovered that the average retired household will lose out on approximately $111,000 in lifetime income if they begin collecting Social Security benefits earlier than is ideal.
Which age suits you the best?
Once more, there isn’t a set age at which all retirees should file; it depends on your particular circumstances. But you can take your time with this choice by thinking about what’s most important to you in retirement.
If your main goal is to make as much money as possible each month, you might want to wait as long as possible—ideally until you’re 70 years old. The most recent data from the Social Security Administration, which came out in December 2023, shows that the average retiree gets about $739 more each month at age 70 than at age 62. If money is tight in retirement, those bigger checks can make a big difference.
But if retiring early is more important to you than making the most money, filing early may be a good idea. Even though money isn’t everything, retiring early can help you reach your goal if you have a big retirement fund or are willing to give up some things to retire in your early 60s.
It might also be a good idea to think about your health. Even though it’s not a fun subject to consider, it might be a good idea to file early if you have any reason to think you won’t live well into your 70s or beyond.
Social Security confirms new payment date for Seniors Over 65 and Disabled Individuals
Putting off getting Social Security benefits until after age 70 can save you money, but that’s not the only thing that should be thought about. If you think about your priorities and the big picture, it will be easier to figure out what age is best for you to retire.
The $22,924 Social Security benefit that most retirees don’t even think about
Most Americans are at least a few years behind schedule on saving for retirement.
However, there are a few little-known “Social Security secrets” that might help guarantee an increase in your retirement income. For instance, a simple trick could increase your annual income by up to $22,924! We believe that if you understand how to optimize your Social Security benefits, you will be able to retire with the assurance and tranquillity that we all desire.
