Social Security Strategy
We’re often asked, what’s the best age to claim Social Security benefits? The truth is there’s no one-size-fits-all answer. Some retirees may be better off collecting partial benefits as early as 62, others may benefit more by waiting until full retirement age, and some may prefer delaying until age 70 for maximum benefits.
Our Philosophy & Approach to Social Security Strategy
1. We believe your claiming strategy should support your vision of retirement
When to claim Social Security shouldn’t be purely a dollars and cents decision. It should also reflect what’s most important to you. We’ll take the time to get to know you so we can understand your vision of retirement in addition to your financial needs.
2. We encourage you to think about Social Security as one piece of your entire retirement income plan
You don’t come to us for one-size-fits-all solutions. We help you make decisions about Social Security within the context of your overarching financial picture and personal goals. Your benefit is one piece of the customized retirement income plan that we create for you.
3. We educate you so you know the ins and outs of Social Security
Social Security is governed by thousands of rules. We’ll explain the most important of these and why they’re relevant. Each time we make a recommendation, we’ll tell you how we came to our conclusions and why they make sense for your situation.
Since Social Security is a crucial piece of your overall retirement income plan, your claiming strategy should be viewed within the broader context of your finances, personal and family life, and vision of retirement. Factors to consider include your retirement savings, potential corporate pensions, projected living expenses, health status, family longevity, marital status, and age difference between you and your spouse.
Social Security has thousands of rules, many of which are essential for maximizing its benefits. For example, if you earn above a certain limit while claiming a partial benefit, it may be reduced until you reach full retirement age. Additionally, federal taxes on your benefits depend on your total combined income rather than your age at application. Exceeding a certain threshold means 85% of your benefit will be taxable instead of 50%. This distinction can significantly impact your decision on when to claim.
It’s a common misconception that delaying Social Security means you’ll receive a higher benefit. While your monthly benefit may be higher, the total amount you receive over your lifetime could be the same or even lower, depending on your lifespan. Your health and family longevity are important factors to consider.
We’ll Help You Decide When to Claim Social Security
At Freedom First Retirement Design, we provide the insight and expertise to help you determine the best claiming strategy. By combining a qualitative and quantitative perspective, we make sure our recommendations are tailored to your ideal vision of retirement. For example, we may advise a retiree to take a partial benefit at age 62 if their savings are insufficient, or we may advise another retiree to claim early to fund their dream of traveling or starting a business.
