Delaying Benefits to Age 70–The Argument Rages - National Association of Plan Advisors
Claiming Social Security benefits at age 62–the earliest possible age to collect retirement benefits–is still the most popular choice for those aging into the system. More than a fifth of new filers choose that option, despite the reduction from their full retirement age (FRA) benefit of up to 30 percent. In doing so, they earn the disdain of many (perhaps most?) financial “experts,” who cite the math that says waiting until FRA or, if possible, until age 70 produces the best return on one’s Social Security “investment.”
In fact, the media has said many times that waiting until age 70 and claiming the delayed retirement bonus allowed under current law will enable the claimant to receive the greatest financial benefit from Social Security. That’s not an absolute. Yes, that strategy will produce the highest monthly benefit, but that’s an entirely different outcome —one that can negatively impact a claimant’s lifetime benefit from Social Security.
In a post today on napa-net.org, National Association of Plan Advisors (NAPA) contributor and retirement industry thought leader Nevin E. Adams, JD offers thoughtful insights on the “claiming benefits at age 62” debate. Adams outlines the potential flaw in the “wait to age 70” advice and stresses the importance of fully understanding each individual’s circumstances before rendering an opinion on claiming age strategies. His concluding remarks capture the argument quite well: “Let’s be straight with people about the tradeoffs — acknowledge the financial realities, and respect — individually, if not collectively — that there actually might be legitimate reasons for claiming those hard-earned benefits at different points in time. But please, let’s quit ‘shaming the claiming’ until/unless we know the particulars of their individual situation(s).”
Read Adams’s thought-provoking post in full here.