When to Take Social Security Retirement Benefits

When to Take Social Security Retirement Benefits?

Concerning when to take Social Security retirement benefits, the Boston College Center for Retirement Research has some research in their publications section that addresses this subject. In particular, see “SHOULD WE RAISE SOCIAL SECURITY’S EARLIEST ELIGIBILITY AGE” by Alicia H. Munnell, Kevin B. Meme, Natalia A. Jivan, and Kevin E. Cahill.

Munnell, et. al. state that payments are set to be “actuarially fair” with respect to taking benefits earlier than full retirement age, which ranges from 66 to 67 depending on your current age. Obviously, you can model the problem with a range of investment return assumptions that will seem to shift the decision one way or the other. But, if you start with the presumption that the payout model is set up to be neutral for the average person, then you need to determine how you in particular (and your spouse) might differ from the average.

Assuming that you do not absolutely need the money to live on, then you might make this timing decision on other factors. Some of the more important factors that comes to mind is relative health and history of longevity in the family. If you and/or your spouse are relatively more (less) healthy than your peer group in your early 60s (when you are first faced with this decision), you might choose to delay (accelerate) accepting Social Security payments. Similarly with family longevity. No matter what, it’s a crap shoot from the standpoints of health, longevity, investment returns, etc., because the future is fundamentally unpredictable.

Click here to get the details about Retirement Financial Planning Software

Related Personal Financial Planning Posts

• Fund Authority Scores for Stock ETFs and Mutual Funds - Historical investment performance ( Fund Authority Scores rate stock mutual funds and ETFs on the most important economic factors affecting long term diversified equity investment fund performance. This article explains how historical fund performance is calculated. <<-- Go to Part 1 Go to Part 3 -->> Part 1 of this article discussed direct and hidden investment costs, the most heavily weighted factors [...])
• May 17 2007 Edition of the Carnival of Financial Planning ( Carnival of Financial Planning - May 17, 2007 Edition Welcome to the May 17, 2007 edition of the Carnival of Financial Planning. The Carnival of Financial Planning takes a long-term view of personal financial planning for individuals and families. We focus on efficient and sustainable personal financial planning practices that can lead to lifetime financial security. This [...])
• Rational Mutual Fund and ETF Screening Rules ( Scientific mutual fund and ETF screening criteria: a summary Scientifically based selection criteria are rational methods to screen mutual funds and ETFs. Recently, The Skilled Investor Blog published a series of articles on scientifically based selection criteria for mutual funds and exchange traded funds (ETFs). These screening rules help you to winnow down the thousands of available [...])
• My Treasure Is Taken by My Credit Card Company ( PIRATES OF THE CREDIT SEA - Part 1: My Treasure Is Taken! Regular readers of The Skilled Investor have already been warned previously of the general dangers of consumer debt and of the risks associated with credit cards. Now, The Skilled Investor has himself become ensnared. In a series of articles, I will: A) summarize my [...])
• Two Examples of the Tax Assets Graphic in VeriPlan ( Two examples of the Tax Assets graphic in VeriPlan TAX ASSETS: Taxable and Tax-Advantaged Financial Assets (real $/yr) Below are two examples of the blue-tabbed TAX ASSETS graphic, which come from VeriPlan's "Sue and Sam Saver" tutorial. This graphic separates their cash, bond, and stock assets by account taxability throughout their lifetime projections. Assets are separated [...])
• Factors Favoring Roth IRA and Roth 401k Plan Contributions - Part 2 ( Factors that tend to favor Roth tax-advantaged plan contributions - Part 2 (Continued from Part 1...) In a recent article, "Traditional versus Roth tax-advantaged plan contributions," The Skilled Investor discussed why the average taxpayer would tend to benefit more by contributing to traditional rather than to Roth tax-advantaged IRA and 401k retirement plans. This follow-up article in [...])
• The Cost of Investment Counselors When You Pay Investment Sales Loads ( How expensive is financial advisor compensation paid via sales loads? A sales load might be the method that you prefer to compensate your broker or advisor. If your advisor is truly competent and ethical, he may be able to manage properly the inherent conflicts of interest that are associated with commissioned investment product sales. Even if [...])
• Pay Lower Expenses To Get Higher Investment Returns - Part 2 ( Pay lower investment expenses to get higher investment returns While financial services industry sales people tell you that you need to pay more to get more, the correct answer is the opposite. Excessive investment costs are a plague on your personal financial planning. Excessive investment expenses are one of the most significant barriers to lifelong family financial [...])