When it comes to Social Security, many people assume that waiting until the age of 70 to claim their benefits is the best option. This is because doing so can increase the amount you receive each month. However, waiting until 70 is not always the right choice for everyone. In some situations, it can actually make more sense to claim Social Security earlier, even if it means receiving a smaller monthly payment. Below are three important reasons why you might want to consider claiming your Social Security benefits before reaching 70.
You’ve Lost Your Main Source of Income and Need the Money Sooner
One of the most common reasons people claim Social Security benefits earlier than planned is because they lose their main source of income. While many individuals plan to work until age 70 and delay claiming Social Security, life sometimes doesn’t go as expected.
The job market can be tough for older workers. Although it is illegal for employers to force people to retire because of their age, many workers over the age of 50 can face discrimination. As a result, you might find yourself out of work sooner than expected.
Health issues can also cause people to retire earlier than planned. If you or your spouse has serious health problems, it could be impossible to continue working. In such cases, relying on Social Security benefits sooner may be a better option than getting into debt just to cover living expenses.
Your Health Isn’t Great, and Your Life Expectancy Is Uncertain
Another reason to claim Social Security benefits before turning 70 is related to your health. While waiting until 70 can give you larger monthly payments, it is only beneficial if you live a long time to collect those payments.
If your health is poor and you don’t expect to live for many more years, delaying your benefits until 70 may not make sense. In this case, it could be better to start claiming benefits earlier, even if the monthly payment is lower. The goal is to maximize the amount you receive over your lifetime, and waiting too long could mean you miss out on those benefits entirely if your health declines.
Remember that your Social Security payments are designed to provide support for your entire life. If there is a concern that your life expectancy is shorter than average, claiming early might allow you to receive more money over the course of your lifetime, despite the smaller monthly checks.
3. Your Spouse Needs You to File So They Can Get Their Benefits
If your spouse never worked or worked only part-time, they may not have earned enough Social Security credits to qualify for benefits based on their own work history. In such cases, your spouse can claim spousal benefits, which can be up to 50% of your monthly Social Security benefits once you reach full retirement age.
However, your spouse cannot claim these spousal benefits until you start receiving your benefits. If you wait until age 70 to claim your Social Security, your spouse may have to wait longer than they want to start receiving their benefits. If your spouse needs the money sooner — perhaps to take a dream trip before health issues arise — it may make more sense to file for benefits earlier so they can start claiming their share sooner.
There are situations where delaying your Social Security benefits makes sense, especially if you are much older than your spouse. By waiting, you could increase your monthly benefits, which would also provide your spouse with a higher survivor benefit if something happens to you. However, this is something that you should carefully consider based on your spouse’s needs and your own circumstances.
While waiting until age 70 to claim Social Security benefits can offer larger monthly payments, it’s not always the best choice for everyone. If you lose your job unexpectedly, have health concerns, or your spouse depends on your benefits, claiming earlier may be a better option. It’s important to assess your situation carefully and consider all your options before making this decision.
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