Social Security: Will Everything Go According to Plan?

As we always remind our clients, Social Security was only meant to be a supplement to your retirement income. You can’t completely rely upon it to fund your retirement. Having said that, you do need to know what you can expect from the program, and of course you need to incorporate your benefits into your overall retirement income strategy.

Many of you are probably planning to wait a while before filing for benefits. You’ve learned that for each year you wait, beyond your full retirement age, your monthly checks will be about 8 percent larger. And, of course, retiring before your full retirement age will result in smaller checks. So many people decide to “wait as long as possible”, but is that plan actually working out for current retirees?

According to statistics from the Social Security Administration, claims (for current retirees) happened within these time frames:

• 34.5% of men and 39.7% of women filed for benefits at age 62
• 22.4% of men and 23.8% of women filed for benefits between ages 63 and 65
• 33.9% of men and 27.5 % of women filed for benefits at age 66
• 7.1% of men and 5.7% of women filed for benefits between ages 67 and 69
• 2% of men and 3.3% of women waited until age 70 to file for their benefits

As you can see, some retirees did succeed in waiting beyond their full retirement age (65 to 67, depending upon your year of birth) before claiming benefits. A small number even managed to wait until age 70! But we can also see that those situations aren’t as common as we might have hoped.

These statistics didn’t break down the reasons that some people can’t wait longer. We can only guess that some never planned to wait that long, while others fell short of their plans due to illness or some other life event. The point is that, no matter what we plan with regard to Social Security, some of us might need to file for benefits earlier than we had expected.
You should still make the plans that make the most sense for your situation. However, always include room in your budget and financial strategy, so that you don’t have to depend too heavily upon your Social Security benefits. Give us a call, and we can explain this topic in more depth, and help you to create a Plan B if necessary.

*Stats from Social Security Administration, 2016