Social Security: Why Patience Doesn’t Always Pay Off


They say patience is a virtue, and when it comes to Social Security, it certainly can be. That’s because petitioners who defer their Social Security claims are financially rewarded.

You are entitled to your full monthly Social Security benefits based on your personal pay history once you reach your full retirement age (FRA). That age is 66, 67 or 66 and a certain number of months, depending on your year of birth.

But you don’t have to file for Social Security with your exact FRA. You may apply as early as age 62, but filing at any time before FRA will result in a reduced benefit for life. Likewise, you can defer your filing past FRA and lock in a higher monthly benefit for life in the process.

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If you turn 70 now, you won’t be able to grow your Social Security benefits anymore. But if you’re willing to be patient and delay your filing until age 70, you could see your monthly benefit increase between 24% and 32%, depending on your exact FRA.

At first, that may seem like a smart bet. But in some cases, it’s a decision that can backfire.

Waiting doesn’t always pay off

If you don’t have a lot of money in retirement savings, you may be motivated to delay filing for Social Security so that you can grow your benefit monthly. And even if you have quite a nest egg, you may like to get a higher monthly Social Security payment to give yourself more purchasing power. But while delaying your claim is guaranteed to reap your benefits monthly boost, it doesn’t guarantee you a higher one lifetime social security payment.

There is a break-even point to consider when considering deferring your Social Security application. If your FRA is 67 and you want to defer your filing until age 70, your break-even point is 82 1/2 years. That means that’s the age at which you received the same amount of Social Security in both filing scenarios. And so you have to ask yourself if you think you’re likely to live to 82 1/2 or longer. If not, there is no point in delaying your filing until age 70.

It may even pay to file early

While delaying claiming Social Security can result in a richer monthly payday, it’s not necessarily the best move. In fact, Social Security filers are often warned not to claim benefits before FRA, as it can greatly reduce them. But if your health is poor and you are unlikely to live a long life, filing at age 62 may make financial sense.

Ultimately, it can be difficult to pinpoint the right timing for claiming Social Security. But one thing you should know is that while exercising patience can be a good thing in life, it’s not necessarily the right thing to do when it comes to signing up for your benefits.

The Valley Voice
The Valley Voice
Christopher Brito is a social media producer and trending writer for The Valley Voice, with a focus on sports and stories related to race and culture.


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