Friday, June 28, 2013

Social Security Options

I'm learning there are many factors to consider on when to start taking Social Security payments.  Unfortunately, there is no right answer since it mostly depends on when the recipient dies, which won't be known in advance.  Here are some of the factors:
  • Earlier or later.   People can start as early as 62 with reduced benefits or wait until 70-1/2 for higher benefits.  Based on my analysis, 78 is the breakeven age for me.  If I die before 78, going earlier is better.  If I live past 78, starting later is better.   For a surviving spouse, later is always better.

  • File and suspend.  At full retirement age, a person can choose to file and suspend benefits so that a spouse can get the spousal benefits.

  • Other family member benefits.  In some cases, minor children are eligible to receive benefits also.

  • I always thought Social Security would be gone by the time I was eligible for benefits.  But now that I'm getting closer to the minimum age, I'll be doing a more detailed analysis of the options with my financial advisor.
    For more on Reaping the Rewards, check back every Friday for a new segment.

    This is not financial or retirement advice. Please consult a professional advisor.

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