How to Claim Your Social Security Benefits at an Earlier Age
According to the Social Security, one must be of age 70 before he or she is entitled to claiming their social security retirement benefits. According to financial experts, this is where you can get your maximum benefits.
What’s more? Your benefits get an increase every year that you withhold from collecting your benefits. And yet, waiting until you’re in the 70s seems like a daunting task to do. Here’s what you can do according to financial experts.
The Best Sector to Delay Claiming Benefits
According to Financial Engines chief investment officer, Christopher Jones, most married couples and high-wage earners must wait for as long as possible before making their claims.
There are two reasons for this recommendation according to him. One, most Social Security payments are made based on their mortality tables. According to Jones, the tables have not been updated since the year 1983. And life expectancies since then have increased over the time.
Jones added that since most people tend to live longer nowadays, the credits you accumulate for delaying your Social Security claim benefits will double or triple. Another reason is that Social Security still adapts the low-interest rate environment.
This means that every year you delay claiming your benefits, your money increases from 6-8%, guaranteeing a high return on investment. Thus, Jones recommends holding off the claim for most married couples or high-wage earner to avail of these incredible benefits. However, this may not be the case for the low-wage earners.
For Low-income Earners
Meanwhile, Jones says that low-income earners don’t need to wait until the 70s to claim their benefits in full. According to him, they can generally claim their benefits at the age 66-67 years old.
This is because their high-income earner spouse can hold their benefits until the age of 70s. Meanwhile, the single people will have two options in claiming their benefits. Either they can wait it out until 70, or they can avail of the next best option: to withdraw earlier.
The Alternative Best Age to Claim Benefits
Jones says claiming your benefits a year earlier may cost you a few thousand dollars, but the benefits you can get from claiming earlier may outweigh your cost.
According to JS Consulting’s managing director Jason Scott, you need to be asking yourself on how long you expect to live to determine whether or not you need to claim your benefits already. If you’re still employed and functioning well, you may be healthier than average and you can hold out your claim.
But if you’re already frail and are suffering from a health condition, or if you just want to live your life to the fullest and pursue your passions and hobby the moment you retire, then it’s best to start claiming your benefits sooner.
Aside from your life expectancy, you should also look into your health, income, and employment history. According to Scott, individuals who live a healthy lifestyle, who are still employed and have multiple savings and investments tend to live longer and support themselves even after retirement.
Individuals who fall into bad health habits like drinking, smoking, and have a family history of diseases, on the other hand, have the opposite effect.
Jones adds an individual can consult a financial advisor to evaluate his different options and how these options can impact their claiming benefits. Alternatively, they can also install the Social Security software. He also warns people to adjust their cost-of-living first when doing their benefit check to determine if their expenses will remain the same for the rest of their lives.
This is to determine the right time to file a claim without committing a huge mistake. According to Jones, you can only withdraw your application once, not to mention you may have to repay all the funds you’ve received so far. So he encourages individuals to think things through before deciding.
More in Pocket Change
Find Out How Social Media Can Ruin Your Insurance
Social media has taken over the world. Almost everyone owns at least one social media account since it has become a...November 2, 2018
eBikes Will Now Be Used By UPS for Delivery Around Seattle Area
For years now, UPS or the United Parcel Service has been trusted by many people when it comes to delivering their packages....November 2, 2018
Best Traits to Look For in a Successful Real Estate Agent
Selling your house or even looking for one isn’t a walk in the park. There are a lot of things to...November 2, 2018
Delaying Homeownership Could Hurt Millennials’ Financial Security After Retirement
Millennials have plenty of things to worry about including student loans, career, love life, and much more. However, there’s one thing...October 31, 2018
Why Traditional Career Counselling Methods Might now be Very Useful and How They Can be Changed
The professional world is constantly changing. Workers from previous generations often got jobs as soon as they graduated from college and...October 30, 2018
McDonald’s Continue to Rise With $205 Million Investment and Impressive Q3 Report
When it comes to the world of fast food, there is one particular place that is known not just in the...October 30, 2018
Here’s Why Envisioning Retirement is a Good Idea
Aging is part of being human, it is just absolutely inevitable. This is actually one of the most important things that...October 29, 2018
Amazon Superseded by Tech Rival as Second Most Valuable Company in the World
It was a disappointing week for Amazon whose shares took a sharp downturn after dismal quarterly returns. The ecommerce giant has...October 29, 2018
It’s High Time You Skilled up and Developed Your Career to Harmonize with AI
There’s no doubting it, AI is becoming part and parcel of your daily life. As the dependency of artificial intelligence becomes...October 29, 2018