Your retirement plan will be composed of many different variables, all of which come together to form a complete picture. Social Security is just one part of your overall plan. You know that the program was only meant to serve as a supplement to other forms of income in retirement, but at the same time, those benefits are pretty significant to you. So, many of your decisions will revolve around timing your Social Security claim.
It can be a good idea to wait as long as possible (up to age 70) to claim your benefits because your checks will be larger if you do. On the other hand, some people can’t wait until age 70 to retire, or even anywhere close to that. So as your retirement plan continues to evolve, how do you adjust the rest of the picture to account for this uncertain part of the puzzle?
It might help to take a look at what current retirees have done. According to the Social Security Administration’s own statistics, current beneficiaries first filed their claims at the following ages:
- 34.5% of men and 39.7% of women filed for benefits at age 62
- 22.4% of men and 23.8% of women filed for benefits between ages 63 and 65
- 33.9% of men and 27.5 % of women filed for benefits at age 66
- 7.1% of men and 5.7% of women filed for benefits between ages 67 and 69
- 2% of men and 3.3% of women waited until age 70 to file for their benefits
These numbers aren’t surprising. While some beneficiaries did manage to hold out and claimed their payments at a later age, many went ahead and filed their claims in their early to mid-sixties. These are just statistics, of course, so we can’t know all of the reasons that current retirees made this choice. But it would be a fair guess to say that some wanted to wait a bit longer to file their claims and reap larger checks, but life had other plans for them.
The takeaway lesson here is that while waiting to claim Social Security might sound like a good idea, it doesn’t always work out that way for everyone. As your expected retirement date approaches, try to be fluid and flexible with your plans. Establish enough retirement income, via other planning avenues, so that you don’t have to rely too heavily upon Social Security to fund your lifestyle.
For more information on those other avenues, or for help adjusting your plans in the face of unforeseen situations, give us a call. We can help you make any necessary adjustments so that your retirement plans don’t depend too much on Social Security.
*Stats from Social Security Administration, 2016