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New study: Early claimers see increased incidence of poverty
More people claim their Social Security benefits at age 62 than at any other age. But this could be a terrible mistake. In this Market Watch article, Mark Hulbert cites a new study circulated by the National Bureau of Economic Research: “Early Social Security Claiming and Old-Age Poverty,” by Gary Engelhardt, an economics professor at Syracuse University, Jonathan Gruber, an economics professor at MIT, and Anil Kumar, an economic policy adviser and senior economist at the Federal Reserve of Dallas.
The major finding is that early claiming of Social Security benefits leads to a significant increase in the number of retirees living in poverty. Gruber noted the finding reflects the entirety of a retiree’s financial situation during retirement, of which Social Security benefits are just one part. But, when all income sources are taken into account, they found that early claiming is associated with a greater probability of living below the poverty line. Gruber believes there is a lack of education about the benefits of delaying Social Security and that many early claimers may be choosing immediate gratification with little regard for the long-term consequences. Read more here.
The AMAC Foundation offers a free-to-the-public advisory service to all folks ageing into–or already in–Social Security. This service provides guidance in understanding the complexities of Social Security and the myriad rules and regulations associated with the process for claiming benefits, with NSSA-Certified Social Security Advisors available via email or telephone to discuss options. Learn more about this service via the Foundation’s website.