Knowing the appropriate time to claim Social Security benefits is a significant retirement decision, so it is crucial to decide at the right time. You can lose a considerable amount of the benefit payout if you claim early. If you don’t file for Social Security early, you can also regret delaying your benefits for extended periods beyond the right time. Even though there is no single answer to when you should claim Social Security benefits, with these three signs, you will know if you are ready to claim them. 1. You Retirement Savings are in the Best Condition Ideally, your Social Security benefit will replace approximately 40% of your income a few years after retirement. This implies that you may need other income sources to maintain your finance if you can’t cut off your expenses after retirement. Saving enough money for your retirement depends on several factors, such as your expected years in retirement and your projected future expenses. The lifestyle you want to lie in after retirement may affect your consumption level and expenses during retirement. Depending on your chosen lifestyle, your expenses may increase or decrease after retirement. Suppose your retirement savings is not in good condition, or you want to use Social Security benefits as your only income source after retirement. In that case, it is best to claim your Social Security benefits late. 2. Know Your Age Impact on Social Security Benefit Payout Your monthly benefits payments will affect the age you start claiming benefits. You will receive the full benefit if you claim Social Security at your full retirement age (FRA). However, the full retirement age (FRA) varies depending on your birth year. Your work history determines the full benefit payments you will receive. If you are 62 years old and file for Social Security, you will receive a reduced payment because you have not reached the full retirement age (FRA). When you defer your benefit, you will earn monthly bonuses until you are 70. You will no longer receive monthly bonuses if you delay your Social Security benefits beyond 70 years. The right age to claim Social Security is your decision. But with the proper understanding of age impact on benefit payout, retirement planning becomes more straightforward. 3. Build a Solid Strategy Together with Your Spouse If you and your spouse are eligible for Social Security, developing a strategy for individual spouses claiming time is best. You may decide to claim Social Security simultaneously, irrespective of your age. On the other hand, one spouse can now claim while the other defers. With this approach, you can have additional money immediately after retirement while receiving monthly bonuses due to benefit deferral. Older couples should consider their lifetimes before claiming Social Security. If one of the couples dies, the remaining spouse may receive all the dead spouse’s benefits based on the survivor’s benefits. If your spouse is terminally ill or has a condition that will make one spouse survive the other, it will help if you factor in survivor services in your retirement strategy. Many seniors find it hard to decide when to start claiming their benefits, but your earlier preparations for retirement will influence the best time to claim. Considering these three factors, you can claim Social Security benefits anytime soon.
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