Learn, Earn and Discuss Social Security - Claiming SS

[AARPTeri]

AARP has a calculator to determine When to claim Social Security to help you determine the right timing for you! You can also earn AARP Rewards points, not signed up for AARP Rewards yet? Click here!  

Share what you learned from this calculator that you didn't know before! Did it help you make a decision?

[nazfam]

Calculators ignore many variables. What if I can afford to retire at 62 without SS but draw it anyway and invest it at modest 5% annual return. 8 years later, recommended age 70, I’d accumulate $147,570, easily offsetting the higher lifetime benefit of waiting until 70. Otherwise considerations would be, what weee the affects of drawing down other investments that I was obviously surviving on, or just not retiring until 70. 

[Tonster521]

@nazfam Longevity is another factor to consider. Many folks evaluate when to start SS Benefits based on their monthly amount. Some calculators apply a probability factor with life expectancy to ages greater than 100. Is that realistic? Maybe in a few cases, but for the majority it is not. As you may not know, the SSA advises the average life expectancy is approximately age 84. Keep in mind that age is gender neutral. Males tend to reduce that statistic and females increase it on average. I suggest that you review the SSA  mortality table and develop present value comparisons at different ages as well as different discount rates (i.e., 3%, 4%, 5%, etc.).S It gets more complex if you factor in Spousal and/or Survivor Benefits, if married. Spouses that also worked in Covered Employment will have their Spousal and/or Survivor Benefits reduced by their Worker (own) SS Benefit. Spouses that worked in Non Covered Employment (i.e., some teachers, fire, police, etc.) who receive government pensions will receive unreduced SS Benefits in addition to their government pensions. This was just signed into law by President Biden in January, 2025. So, if married, and your spouse has a government pension due to working in Non Covered Employment, there is a huge monetary advantage to start your SS Benefits the minute you and spouse become eligible. I am providing a link to the SSA  Actuarial Life Table for your review. https://www.ssa.gov/oact/STATS/table4c6.html 

[GailL1]

Of course, the decision is based on one’s own situation.  I waited but that was because I had unearned income that I could support myself on - then at 70, I got the delayed retirement credits and then I also had to start drawing my IRA RMD.

The real problem is the people that file for retirement at 62 and get the reduced benefits - and they don’t have any other funds to make ends meet.  Then as time goes by - their living cost rise and they cannot easily adjust.  

[BalbonisMoleskine]

That's smart. I'm planning to do something similar: Start collecting at 62 and live off of that as much as possible so my IRAs and other accounts can continue to grow. 

[GailL1]

That’s only gonna help the Trust Fund - so thank you and all who are considering to file for early benefits at 62 and getting a reduced benefit.

[2Papa]

Get it soon as you can!  If you wait, you may not get any!

[GailL1]

Great - getting it at 62 at a reduced rate will help the Trust Fund balance.  However, if it isn’t enough to stave off insolvency come 2033 or so then your reduced benefit will be reduced by 20% (by law)  or so just like my higher benefit.  

[BalbonisMoleskine]

Yes. Bird in hand.