Only 3% of Social Security Recipients Are Taking Advantage of This Benefit-Boosting Move — The Motley Fool

Millions of seniors accumulate Social Security in retirement, and for a big quantity, these advantages spell the distinction between staying afloat financially and teetering on the sting of poverty. Given the essential function Social Security performs in so many seniors’ lives, you’d assume extra individuals can be taking steps to safe the best month-to-month profit doable.

But in actuality, solely three% of eligible recipients file for Social Security at age 70, which signifies that the overwhelming majority of beneficiaries aren’t maximizing this crucial supply of revenue.

It issues once you file

Though your Social Security advantages are based mostly in your 35 highest years of earnings, the quantity you wind up with every month will depend upon how outdated you’re once you file for them. If you file for advantages at full retirement age, or FRA, you may get the precise quantity every month that your earnings historical past entitles you to. Here’s what FRA may appear like for you, based mostly on once you had been born:

Year of Birth

Full Retirement Age




66 and a couple of months


66 and four months


66 and 6 months


66 and eight months


66 and 10 months




That stated, you really get an eight-year window to file for Social Security that begins at age 62 and ends at age 70. (Technically, you possibly can file after you flip 70, however as we’ll talk about in a minute, there is no motive to attend previous that time.) Filing at 62 means getting your advantages early, but it surely additionally means lowering them considerably.

For instance, in case your FRA is 67 however you file at 62, your advantages will take a 30% hit. And until you handle to withdraw your application shortly after beginning to accumulate advantages, that diminished month-to-month cost is what you may be caught with for the remaining of your life.

Smiling senior man holding dog.


On the opposite hand, in case you maintain off on taking advantages previous FRA, you may accrue delayed retirement credits that enhance your funds by eight% a 12 months, up till age 70. Since you possibly can’t rack up these credit indefinitely, it is smart to file for Social Security by your 70th birthday, as a result of ready even a day longer will not make it easier to achieve something financially. Once you rating that eight% enhance, nevertheless, it is going to stay in impact for the remaining of your life.

Here’s how that may work to your benefit. Let’s say you are entitled to a full month-to-month profit of $1,600 at an FRA of 67. If you wait till 70 to file as an alternative, you may improve your full month-to-month profit to $1,984. From that time on, you may accumulate an additional $four,608 a 12 months throughout retirement, which might come in useful for paying payments and even treating your self to an additional trip annually.

Don’t leap the gun

A assured eight% enhance in advantages is a fairly neat incentive for ready a number of years to say them. So why do not extra individuals leap on that choice? Partly as a result of seniors are sometimes pressured to retire sooner than planned, thereby leaving them with no alternative however to file for advantages as early as doable.

Furthermore, ready till age 70 to say Social Security is not the neatest transfer in case your well being is poor as a result of in case you go away at a youthful age than the typical senior, you may find yourself accumulating much less cash in advantages in your lifetime. Finally, many older Americans are involved that Social Security goes bankrupt (it is not), and subsequently rush to say advantages for worry that in the event that they wait, they will not find yourself seeing a dime.

The first two are actually legitimate causes not to attend till 70 to file for advantages. The final one, although based mostly on rumors, is considerably comprehensible, as properly. Either approach, you probably have the choice to carry off on advantages for so long as doable, take it. It’s a fail-safe solution to enhance what might simply find yourself being your biggest revenue stream for all times, thereby setting the stage for a extra financially safe retirement on the entire.

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