Considerations for Taking Social Security Benefits

Written by: Chris O'Shea | savvymoney.com

Signs that you might want to take Social Security benefits.

Whether you’re in retirement or near retirement, Social Security is an important topic. For a topic so relevant and important to so many, there are a lot of questions about what to do, when to do it, and how to get what you need from Social Security. We’ll lay out some considerations to help in your decision-making process.

Questions About Taking Social Security Payments

The biggest question about Social Security is the “best age” to begin payments. This will vary by individual based on lifestyle, health, and savings. But here are a couple of common thoughts on the subject.

Delaying Social Security Payments

One school of thought is to wait as long as possible before taking Social Security benefits. The longer you can put it off, the larger your potential payouts may be. However, putting it off too long is not a feasible option for many individuals.

Reasons to Begin Taking Benefits

Here are a few reasons you may consider that it’s time to start taking your benefits.

• Health Decline. While waiting to take Social Security may increase future payouts, if your health is in decline, you might want to consider taking payments early. Yes, you may forgo larger future payments, but those funds could help with medical bills.
• Family Longevity. You may consider taking Social Security earlier rather than later if there are health and longevity concerns in your family history. While family history doesn’t always mean a shorter lifespan, it is a consideration when thinking about how and when to receive your Social Security benefits.
• Mounting Expenses. You may think about taking your benefits early if your overall expenses are piling up. You could take payments earlier to cover expenses so you can enjoy your golden years.
• Leaving the Workplace. Life is simply too short to continue working, especially if your job is physically taxing or hazardous to your overall health. If you want or need to end your working years —and you’re only working to ensure you get the highest benefits possible – consider drawing your benefits early.

Do One Thing: Consider your personal financial and health situation when deciding when to take Social Security benefits. The general rule of thumb is to wait as long as possible so your potential future payouts are larger.

This is intended for educational purposes only. When considering your Social Security benefits, consult a trusted financial advisor who specializes in tax planning to help you make the optimal decision for your situation.