Starting your social security withdrawals before full retirement age could result in THOUSANDS of dollars of reduced potential retirement income FOR THE REST OF YOUR LIFE.
Yep. You can start your Social Security retirement benefits as early as age 62, but the amount you receive will be less than your full retirement benefit amount. (Check out this nifty reference chart from SSA.gov to see how you would be affected based on your age and when you opt to receive your benefits).
While it might be news to you, this isn't anything new. Full retirement age, also called "normal retirement age," was 65 for many years. But in 1983, Congress passed a law to gradually raise the age because people are living longer and are generally healthier in older age.
The law raised the full retirement age beginning with people born in 1938 or later. The retirement age gradually increases by a few months for every birth year, until it reaches 67 for people born in 1960 and later.
So, before you start running to the Social Security office and filling out that paperwork on your 62nd birthday, take a moment to consider if it's in your best interest to start making those withdrawals as soon as you're eligible to do so.
The above is just one example of five that you will find in this episode of After The Paycheck. Sam and Adam discuss five tips for making a retirement income drawdown strategy, and also discuss other factors you need to consider, including:
- Your marital status
- Your savings
- Your life expectancy
- The kinds of retirement accounts you have
- What you think your expenses will be in retirement
Five Tips For Making A Retirement Income Drawdown Strategy:
1) Account for Inflation
2) Choose The Best Pension Payout (If you have one)
3) Consider Your Social Security Benefits Options
4) Balance Guaranteed Income and Long-Term Growth
5) Plan For Longevity
Have a list of questions around your finances? Thinking about your retirement situation?
Let’s take some time to talk about the money obstacles you may be facing.
Whether you’re asking questions about when you can retire, how to manage your investments, or if you have enough to leave the impact you want for your family and community, we’re here to help.