One of the many areas in which I help my clients is planning for retirement. Many people want to have a good understanding of how much they can spend, what type of investment return they need, and of how these decisions affect their portfolio.
A major source of income for most investors is Social Security. Every retiree has a choice of when to begin taking Social Security payments. While some people ignore this in their planning or take the decision lightly, this choice can make a big difference. Some investors want to start taking Social Security as soon as they can; however, delaying until at least your full retirement age offers a wide variety of advantages that can help maximize your benefit.
For some people, the choices are quite simple and straightforward. Other people have multiple options that aren’t necessarily obvious. If you are coming up on a Social Security decision, or if you recently made a decision, you might benefit from reading this article, published in Kiplinger’s Personal Finance Magazine.
This isn’t the place to try to explain the details of Social Security options. But here are a few highlights that are sometimes overlooked:
- Some married people can “file and suspend” benefits to let one person collect spousal benefits while the other delays the start of benefits to age 70.
- Some people can claim spousal benefits while they keep working in order to maximize their own benefits.
- In some cases, divorced spouses are entitled to benefits they might not know about.
- Retirees with dependent children under age 18 may find their children are eligible for partial benefits.
The rules can seem confusing, but they contain some opportunities for those who take the trouble to understand them. My advice: Before you start taking benefits, and while you are planning your retirement income, seek advice either directly from the Social Security Administration or from your financial advisor. We are here to help you get everything that’s coming to you – and in some cases that is a lot.