Baby boomers are fast approaching their entitlement to Social Security retirement benefits. Many face an important decision as to whether to begin receiving these benefits at age 62, normal retirement age or to delay receipt until after normal retirement age.
Normal retirement age depends upon the year you were born. If you were born between 1943 and 1954, normal retirement age is 66. If you were born in or after 1960, normal retirement age is 67. Those born between these years have a graduated normal retirement age between ages 66 and 67.
Regardless of your normal retirement age, you may elect to receive your Social Security retirement benefits as early as age 62. For those facing this decision in the next 10 years, monthly benefits are permanently reduced by 5/9 of 1% for the first 36 months and 5/12 of 1% for any remaining months of benefits taken before normal retirement age. You can also decide to defer receiving your benefits past normal retirement age. If so, your monthly benefit will be permanently increased by 2/3 of 1% for each month you wait (up to age 70).
Social Security is designed, considering the population as a whole, to provide the same lifetime benefit whether received early, late or at normal retirement age. Your personal decision will depend upon a number of factors. The initial question is whether you have the flexibility to choose when to receive your benefits or because of economics, you need the cash as soon as possible. You may also want to consider your health and life expectancy.
Assuming you have the flexibility, most if not all actuarial studies show that in most cases, you would be better off electing to receive your benefits at age 62. There are several scenarios though where you may want to delay receiving your benefits.
If you intend to work after age 62. Social Security retirement benefits are reduced by $1 for every $2 of earnings greater than $14,160 in 2009 ($1 for every $3 of earnings greater than $37,680 if 2009 is the year you reach normal retirement age).
If you have not maximized your Social Security retirement benefit If you work after attaining age 62, you may increase your benefit to the extent your earnings in these years are greater than previous year earnings.
You should visit http://www.ssa.gov/. to see how these rules affect you personally. The retirement planning option will give dollars and cents options applicable to you.. Regardless of when you decide to receive retirement benefits, be sure to apply for Medicare benefits at age 65 since there is no advantage in delaying this benefit.
Normal retirement age depends upon the year you were born. If you were born between 1943 and 1954, normal retirement age is 66. If you were born in or after 1960, normal retirement age is 67. Those born between these years have a graduated normal retirement age between ages 66 and 67.
Regardless of your normal retirement age, you may elect to receive your Social Security retirement benefits as early as age 62. For those facing this decision in the next 10 years, monthly benefits are permanently reduced by 5/9 of 1% for the first 36 months and 5/12 of 1% for any remaining months of benefits taken before normal retirement age. You can also decide to defer receiving your benefits past normal retirement age. If so, your monthly benefit will be permanently increased by 2/3 of 1% for each month you wait (up to age 70).
Social Security is designed, considering the population as a whole, to provide the same lifetime benefit whether received early, late or at normal retirement age. Your personal decision will depend upon a number of factors. The initial question is whether you have the flexibility to choose when to receive your benefits or because of economics, you need the cash as soon as possible. You may also want to consider your health and life expectancy.
Assuming you have the flexibility, most if not all actuarial studies show that in most cases, you would be better off electing to receive your benefits at age 62. There are several scenarios though where you may want to delay receiving your benefits.
If you intend to work after age 62. Social Security retirement benefits are reduced by $1 for every $2 of earnings greater than $14,160 in 2009 ($1 for every $3 of earnings greater than $37,680 if 2009 is the year you reach normal retirement age).
If you have not maximized your Social Security retirement benefit If you work after attaining age 62, you may increase your benefit to the extent your earnings in these years are greater than previous year earnings.
You should visit http://www.ssa.gov/. to see how these rules affect you personally. The retirement planning option will give dollars and cents options applicable to you.. Regardless of when you decide to receive retirement benefits, be sure to apply for Medicare benefits at age 65 since there is no advantage in delaying this benefit.
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