At Summit Wealth Group, we encourage clients to think carefully and include Social Security planning as a key part of their financial strategy.
Deciding when to file for Social Security is a highly personalized decision. Factors such as family health history, other income sources, and personal preferences all play a role. There’s no one-size-fits-all answer, but understanding the options and their impact is essential.
To expound a little bit on that, as an example - your full retirement age typically for most people is around 67 and you get 100% of your full retirement age benefit at age 67, which is what you get on that mailer that they send out once a year. If you file early at 62, or between 62 and 67, you get a smaller percentage of that. At age 62, it’s 75%. Now if you wait until age 70, you actually end up getting 124% of that initial benefit.
So there are some considerations, specifically healthwise. If you’re in good health, it typically makes sense to wait a little longer. If you’re not in good health, usually it might make sense to work on it a little bit earlier. If you’re still working past age 62, in some cases it doesn’t make sense to file because you will get a penalty for the additional income.
At Summit, we use financial plans to map out break-even points for various filing ages. This analysis helps determine when the cumulative benefits of filing at different times intersect, guiding you to the best decision for your circumstances.
Social Security is more than just an income stream—it’s a cornerstone of your retirement strategy. By carefully considering your options and incorporating them into a broader financial plan, you can make the most of this vital benefit. If you have questions, we’re here to help. Reach out to one of our advisors for personalized guidance.