Many Wish They Had Delayed Taking Social Security
Tip: One alternative to taking social security early: getting a retirement job.
A survey of AgeFriendly.org visitors reveals a valuable ‘pay it forward’ message from today’s – to tomorrow’s – retirees: delay taking social security if you can.
“When to retire and file for Social Security retirement benefits should be your choice, and this study underscores the need to plan ahead for the unforeseen and save as much as you can,” said Deb Nielsen, Director of Research for the Age-Friendly Institute. “Many are not saving enough for retirement and need to access funds the minute they can – regardless of the longer term impact of the decision – and in some cases, unforeseen health issues are complicating the issue.”
Key Findings from Survey of People Age 70+:
- Three out of 10 (30%) filed at age 62 or younger
- Nearly 4 out of 10 (38%) wish they had filed later
- More than half (53%) filed out financial necessity, such as not saving enough, and another one-third (30%) filed as the result of unforeseen issues, such as health issues or employment changes
“People not being able to sustain for very long on what they’ve saved appears to be a common occurrence today,” said Nielsen.
This study reveals that many are leaving money on the table that they’re eligible for – and that they could have received for many years to come. Planning ahead for the foreseen – and the unforeseen – appears to be the ‘pay it forward’ message from today’s to tomorrow’s retirees.
In the simplest and most conservative cumulative calculation, a married couple with longevity into their early 90’s could be leaving more than a half million dollars on the table – or as much as $2,000-4,000 per month for life – by filing for Social Security retirement benefits at age 62 versus filing at age 70. Furthermore, a surviving spouse could receive $1,000-2,000 per month less for life as a result of filing at age 62.
The majority of survey respondents (79%) felt that they had the appropriate amount of information about when to file for Social Security retirement benefits, and nearly 6 out of 10 (58%) didn’t get help or advice.
“The interesting thing about Social Security modeling is that every person and every couple is different,” said Nielsen. “It is hard to make relevant generalizations about filing strategies. In reality, each person needs to do a careful analysis based on their unique situation in life to help ensure they are not leaving money on the table for years to come, and a financial advisor can help. This study reveals that many are leaving money on the table that they’re eligible for – and that they could have received for many years to come. Planning ahead for the foreseen – and the unforeseen – appears to be the ‘pay it forward’ message from today’s to tomorrow’s retirees.”
The Social Security survey of 618 individuals age 70+ was conducted in 2019 by the Age-Friendly Institute, in conjunction with Massachusetts Mutual Life Insurance Company (MassMutual).