Have you thought about taking social security early?  A lot of people tell me that they’re going to take it as soon as they’re eligible at age 62.  I tell them that’s the worst thing they could possibly do.  They’re leaving a lot of money on the table if they do that.

Why?  If you retire at 62, you still have to pay for medical coverage.  You’re not eligible for Medicare until age 65.  That can cost you a lot of money for those 3 years.  Additionally, if you hold off retiring until your full retirement age, or age 70, you’ll get a much higher benefit.  After your full retirement age, your payout will increase by 8% each year until age 70.  That can add a few hundred dollars to your monthly payment.  If you haven’t already done so, I suggest you set up an account at Social Security.  They have a lot of valuable resources available to you and I recommend you access them.  Every year you delay retirement until age 70, your payment will increase.  Now that’s something to consider!

Holding off retirement until age 70 will maximize your benefit.  Also, if you are at your full retirement age, you can earn as much money as you want without losing any monetary benefit.  If you still work while collecting social security and haven’t reached your full retirement age, they will reduce your payment amount based on your earnings.  Check the Social Security website for specifics.

Moral of the story:

It’s never too early to start planning for retirement and social security is one of those resources.  Do I think that the government will let it go under?  No.  It’s too popular.  So start thinking about your retirement plan now.  And reconsider taking social security at age 62.  As you age, you may regret the reduced payment which you’ll be stuck with for the rest of your life.