Waiting to start Social Security has a key advantage: the longer you delay, the higher your Social Security paycheck will be over time.
But there are cases when it could make sense not to delay, contrary to popular opinion. Let’s explore this topic, and a few scenarios where it makes sense to start Social Security as early as possible–or at least not waiting until your full retirement age.
The financial shock of soaring inflation in 2022 caught everyone off guard. Within a matter of months, the price of rent, fuel, and countless consumer goods went through the roof. Having been in a period of relatively low, calm inflation for decades led us not to worry about this financial expense, until things went really wrong.
While inflation is now trending downward, inflation is historically always present, and there’s still a threat that unusually high inflation can rear its ugly head once again, especially given that most retirees expect to live another 20 to 30 years once they leave the workforce.
For many families, the transition into retirement is more like a series of steps than a leap. Oftentimes, for example, Social Security is started even though an earner is still working. There are many reasons for this, including an interest in at least staying employed on a part-time basis, but needing Social Security to supplement their income.
In times like these, Social Security’s “earning test” may come into play.
I’ve had many conversations with families about the details of Social Security spousal benefits. The rules can be confusing, and the benefit of getting the decision right, such as when and how to file for Social Security spousal benefits, can make a significant impact on your lifetime Social Security benefit.
In this article I’ll take a closer look at this important aspect of Social Security. It impacts most of my clients’ decisions around Social Security, and may benefit yours as well.