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- When you start receiving benefits
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| Home » Social Security » Right time for Social Security Benefits |
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Right time for Social Security Benefits |
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What is the right time to start Social Security retirement benefits?
Deciding on the "best" timing to start your Social Security retirement benefits can be complex. As noted, the amount of your monthly retirement benefit will increase the longer you defer starting benefits (up to age 70). On the other hand, the total benefit you will receive depends on your life span after starting benefits.
The Social Security Administration provides an online calculator to calculate the "break-even" age at which you will receive the same benefits given different retirement ages (http://www.ssa.gov/OACT/quickcalc/
when2retire.html). |
However, this calculator does not consider the time-value of money (that is, the investment return that might be earned by investing the retirement benefits received earlier). Generally, if you have the discipline to invest, rather than spend, Social Security retirement benefits received early, the break-even age is greatly extended.
Some financial planners advocate a strategy for married couples wherein one spouse starts social security benefits at age 62, the other spouse takes spousal benefits (only) at full retirement age, and defers taking his or her full Social Security retirement benefits until age 70. Other financial advisors advocate a strategy of taking Social Security retirement benefits as early as possible and investing those funds while prior to retirement.
You may wish to consult with a financial advisor regarding your options, including investment options and tax consequences of your decisions. More detailed calculators can be found at: http://analyzenow.com/
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