Many Americans reaching the age of retirement have been under the impression that claiming Social Security benefits at the age of 70 is the wisest move. If you take your benefits later in life, chances are you will be given a higher monthly payout. However, with the current financial condition, a few senior citizens might have to rethink that option.
Suppose you have been delaying your Social Security application with the hope of getting the most benefit. In that case, you may be influenced by a few important facts that will potentially overturn your decision.
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Reason 1: Work Is No Longer The Same
Having a plan to wait and start receiving at 70 also implies that you will have secured a source of your income through work. But what if the work you had becomes a hot potato? And for any reason, whether it is extremely significant stress, inhumane workload, or meaninglessness, you are no longer satisfied with your job?
This is a problem that an ever-increasing part of the population is now facing. The reason for one’s happiness with a job could be very different – a mysterious manager, a sudden increase in the amount of work, or a decrease in overall moral levels. For employees who feel empty or stressed at work, they may decide to continue such bad conditions but it has been proved that they will harm their physical and mental health by doing so for three more years.
In the event that your current job situation is affecting your mental and physical health on a daily basis, you may want to quit and switch to the route of claiming benefits earlier, regardless of the fact that its amount is less on a monthly basis, and this way you may be healthier and maintain your health in the future.
Reason 2: Health Can Change Suddenly
People who are physically fit and have no medical issues may be surprised if their bodies start giving them a hard time and their health drastically changes when they are older. Against this background, the idea of suspending the receipt of your Social Security until a future date when you solve your sudden cash flow issues may have less space to stand.
The elderly are told that when they get to 70, they’re secure and the payments are in their hands. It is obvious that if a new diagnosis or chronic condition occurs early in life, then you have high chances of life, and If a person is cut down, then the end result is always a total life income deficit against earlier or on-time commencement.
It’s definitely a good idea to check if Social Security benefits should be delayed especially if your health situation has improved.
Reason 3: You May Already Have Enough Savings
Postponement of benefits makes sense when Social Security is supposed to be the major resource for retirement. However, a lot of folks forget to take into account the funds from their savings.
If your investments, retirement accounts, or even home equity are higher than what you had in mind, you can if fact disregard the waiting up to 70. Claiming benefits earlier would then facilitate living a better retirement life while you are healthy.
Some retirees deem it beneficial to file at full retirement age or even at 62 not because they are obliged to do so but simply because they can. Instead of waiting, if you have enough resources, the utilization of Social Security as an earlier option will make you capable of traveling and recreation, or family gatherings.
It’s Not One-Size-Fits-All
Of course, for many people, at 70, it is still a good decision to wait for lifespans and to fulfill one’s own work, which was not loved, or insufficiently saved for retirement. But it must be kept in mind that the main idea is not to be a blind follower of pieces of advice but to select an option that fits you.
Posing the following questions to your yourself should be beneficial in making a decision:
- Is my work making me feel worse physically?
- Do I feel sure about my health and survival in the future?
- How much of my savings do I really have?
- Do I want to feel more free time in my 60s?
Watch the Numbers — And the Trade-Offs
Benefits from Social Security are raised by 8% each year that you go beyond your full retirement age until 70. It’s clear that this is a good thing, but this is not always the case, as the present value of the claim may sometimes be more important than the growth rate.
Remember: holding on for a longer time doesn’t actually secure that you will get more income during your lifetime. It’s actually a result of your lifetime and the way of life you’ve chosen.
What to Do Next
If you are about to claim Social Security benefits, you should use this period to assess your benefits plan. You should not predetermine alone as there are a number of financial professionals that just deal with Social Security issues offering an initial consultation service.
The case is that regardless of your preferred age — 62, 67, or 70 — the most important factor is that the decision is well-matched with your life, your objectives, and your mental tranquility.
Deciding to wait until 70 is one of the options that can be taken, though by then, some retirees may find it more efficient to claim earlier due to some eligibility changes till 2025.
