Liberty Advising
Let's discuss your Social Security pension. Do you think Social Security is a good deal for seniors? This is an income stream that is guaranteed for life, has inflation protection and it still fairly tax efficient. How many plans are there like that? This is not only a good deal, it is a great deal! But you better get it right or you could cost yourself a lot of income in retirement.
The SSA says that Social Security makes up approximately 38% of household income in retirement. I work in the retirement field and I will tell you with good authority that it is higher than that for most families. In many cases it is the only guaranteed income coming in at all. It is a vital program for our seniors especially since baby boomers generally no longer receive pensions.
The big question is “when do I take it?”
There is no universal answer. Every situation is unique, but there is a maximum strategy for most people. We have a process that all of our clients go through. When someone goes through our holistic income planning process the answer becomes evident. I recommend doing that prior to making a decision on when to start your benefit.
A couple of years ago there were several changes made to Social Security that eliminated some of the claiming options. These changes led to a lot of confusion among consumers and also a lot of fear that Social Security benefits were going to be reduced. That is not true. Here is the simple reality. You have 96 different amounts you can get for your benefit. From age 62 to 70 your benefit increases a little bit each month. The best time to take it will depend on your overall retirement plan.
Take some time to explore your options before deciding when to take Social Security.
The difference in income can be life changing in retirement.
