3 Reasons It's Dumb to Take Social Security Benefits at 70

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When should you start collecting your Social Security benefits? Well, opinions differ, and the answer will vary for each retiree. Much depends on how prepared you are financially, how old you are and when you want to retire, your health, your job security, your family situation, your retirement goals, and so on.

You can start collecting your Social Security retirement benefits as early as age 62 and as late as age 70. By delaying, you can make your ultimate checks bigger -- by about 8% for each year beyond your full retirement age that you postpone collecting. Despite the bigger checks, there are good reasons to not delay collecting until age 70. Here are three of them.

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Reason No. 1: You might have to retire earlier than planned

It's great to have your life planned out -- and indeed, it's critical to plan for your retirement, saving and investing money over many years. But our lives often don't unfold according to plan. You may have decided that you want to retire at age 67, but many of us don't end up getting to choose when to retire.

The 2017 Retirement Confidence Survey found that 48% of retirees left the workforce earlier than planned, with 41% citing health problems or a disability as the reason, 26% citing changes at work such as a downsizing or workplace closure, and 14% having to care for a spouse or other family member.

If the thought of having to retire earlier than planned is horrifying to you, know that you can take some steps to reduce the odds of it happening. For example, you can get and stay in as good health as possible -- and aim for your loved ones to get and stay as healthy as possible, too. This will reduce the chances of being unable to work due to health problems or having to quit to care for a family member. At your job, you might work on being as indispensible as possible, to reduce your chance of being downsized -- or if you have the opportunity to switch to a job with greater job security, give it serious consideration.

Reason No. 2: You might want to retire early

Now, even if you don't have to retire early, or earlier than you originally planned, you might actually want to do so. Why? Well, lots of reasons.

Maybe you have heard that retirees end up restless and unhappy. Well, yes, that does happen to some. A 2014 MassMutual survey found that 10% of retirees were surprised to find themselves lonely, bored, with a lost sense of purpose, and/or depressed in retirement. On the other hand, the same survey found that fully 72% of retired respondents reported feeling quite happy or extremely happy in retirement. Those are good odds!

The sooner we retire, the sooner we can tackle fun activities that we've put off for years, such as driving across the country, taking long vacations abroad, tending to a big garden, taking courses at the local college, or learning a new skill, such as tennis, a new language or carpentry. Early retirees often can enjoy retirement more, being younger, healthier, and more able to travel, enjoy recreation, and so on.

Reason No. 3: It's a wash!

Remember how your Social Security checks get bigger if you delay starting to collect them? Well, if you start collecting them early, they end up smaller. Start receiving benefits at age 62, for example, and they may be about 30% smaller than they would have been had you started at your full retirement age. That's not necessarily a mistake, though. As the Social Security Administration has explained, "If you live to the average life expectancy for someone your age, you will receive about the same amount in lifetime benefits no matter whether you choose to start receiving benefits at age 62, full retirement age, age 70 or any age in between."

After all, while checks that start arriving at age 62 will be considerably smaller, you'll receive many more of them. Starting at age 62 instead of 67 means 60 additional checks -- and starting at 62 instead of 70 means 96 additional checks -- eight years' worth.

When it's smart to take benefits at 70

The reasons we've discussed are solid, but waiting to collect at age 70 can make good sense in some circumstances. For example, if you can afford to wait -- perhaps because you're healthy, you enjoy your job, and you'd like to keep working as long as possible, it can make sense to delay starting to collect. If your family members tend to live very long lives and you expect to do the same, that's another good reason to delay, if you can, because you're likely to collect bigger checks for a longer-than-average period.

Finally, if you're married, be sure to coordinate Social Security strategies with your spouse. Married couples have many more Social Security options than single and never-married people do. For example, a couple might start collecting the benefits of the spouse with the lower lifetime earnings record on time or early, while delaying starting to collect the benefits of the higher-earning spouse. That way, the couple does get some income earlier, and when the higher earner hits 70, the couple can collect extra-large checks. Also, should that higher-earning spouse die first, the spouse with the smaller earnings history can collect those bigger benefit checks instead of his or her own smaller ones.

There are lots of ways to boost your Social Security benefits and get as much as possible out of the program. The more you learn and think about it, the greater your future financial security could be.

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