Social Security Payout: It Pays To Wait - Wesley Ridge Retirement Community
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Social Security Payout: It Pays To Wait

It’s the end of the year, and typically people think about a number of things: New Year’s resolutions, focusing on their health, planning a trip and whether they are going to retire or not. My cousin Don recently bought a new home for himself and his wife closer to his kids in Georgia. His wife moved, but he is still working near Pittsburgh and deciding if he should commute on weekends or just retire. He will be 62 this coming March.

Most of us have been paying into our Social Security since we started our very first job. It is the most common fallback for retirement for many people, but tapping into it too soon can be problematic. For instance, most people know that waiting past age 62 until full retirement age will increase their benefit amount, but do you know by how much? When it comes to Social Security, not understanding the details can lower your benefits for the rest of your life.

Here are some of the basics:

1) It pays to wait. For someone born January 1, 1960 or later, the highest monthly payout would optimize at age 70 with 24% more of the benefit. It drops back the earlier you tap in, example 100% of benefit beginning at age 67 and only 70% benefit if you take it at age 62. Big difference, isn’t it?

2) Survivor Benefits. A person can collect survivor benefits when a spouse dies, but the same rule above applies. You will maximize the benefit by claiming it at retirement age or later.

3) Divorced? Yes, you can still collect within certain guidelines. Spousal benefits are available to unmarried ex-spouses if the couple had been married at least 10 years. It pays to know your former spouse’s work record. Sorry to those of you who thought this was true at five years. It is not.

4) Quarterly statements. Pay attention to your quarterly SS statements, which are meant to keep you on track and help you estimate your payout.

5) Educate yourself. There are resources for you to help answer additional questions as you plan your retirement, such as Social Security for Dummies, available at most local bookstores or online. AARP has done a great job of putting together some helpful sites: to answer your questions or to help you estimate how much you will receive.

The bottom line: knowing what you are eligible for, coupled with accurate information about your Social Security benefits, is sure to put you on the road to a long and happy retirement.