One important consideration is your health status.
Deciding when to start drawing Social Security benefits is a personal choice that depends on various factors
If you have health concerns and are uncertain about reaching the breakeven age of 80, it may be wise to claim your benefits as soon as you become eligible at age 62. However, be aware that this could result in a benefit reduction of up to 30%.
For married couples, coordinating Social Security claiming strategies with your spouse is advisable. The spouse with the higher benefit may choose to delay claiming until age 70 to maximize the survivor benefit for the other spouse. If you come from a long-lived family and maintain a healthy lifestyle, it might be beneficial to postpone claiming your benefit. By waiting, your benefit will increase by 8% annually, adjusted for inflation, from your full retirement age to age 70.
Consider your other assets and investments as well. Certificates of deposit (CDs) may not keep pace with inflation, so relying on cash equivalents can ensure that your Social Security benefit maintains its value. Laddering CDs, which mature at different intervals, can provide a steady income stream. Additionally, your Social Security eligibility typically begins at age 62, assuming you have earned 40 or more credits based on your income.
Your benefit amount is calculated using your average indexed monthly earnings from your highest 35 years of earnings
Missing years or lower income can reduce the benefit amount. The minimum primary insurance amount is $1,033.50 per month, with adjustments for work history. In 2023, the maximum monthly benefit is $4,555.
Survivor benefits are available to widows/widowers, and the amount depends on the deceased spouse’s earnings history. Spousal benefits can be as much as half of the spouse’s primary insurance amount if claimed at full retirement age or later. Divorced-spousal benefits are determined by the number of years married and the ex-spouse’s earnings history. Proof of marriage and divorce is required for documentation.
Remember to consider income tax implications and consult with tax and financial advisors when making your Social Security claiming decision. It is crucial to review your benefit statement and earnings history for accuracy and understand the assumptions used in estimating your benefits.
READ ALSO: New Yorkers Should Have A Better Access To Utility Payment Lawmakers Says