retirement

Don't fall into these Social Security traps

Trap No. 4: Early benefits could be a big mistake
Trap No. 4: Early benefits could be a big mistake © Yuri Arcurs/Shutterstock.com

If you opt to take Social Security as soon as you are eligible, you may be doing yourself an injustice.

"If you delay taking benefits until age 70, you will see as much as an 8 percent increase in benefits for each year you delay," says Steve Gaito, Certified Financial Planner professional and director of My Retirement Education Center. "In addition to receiving a higher benefit, the annual cost-of-living adjustment will be based on the higher number."

"It's hard to find that kind of rate of return on regular investments, so it's good to delay if you can," says Weisman.

Of course, life expectancy plays a part in the decision of when to begin drawing benefits. "You generally know how healthy you are and what your family medical history is," says Ryan Leib, vice president of Keystone Wealth Management. "We advise clients to determine whether they think they will live longer than age 77. If so, delaying until age 70 will net you more in benefits than opting to start collecting benefits early."

If you're able to live off other funds and delay taking Social Security, you should seriously consider doing so. "Delaying taking Social Security until age 70 could mean the difference between cat food and caviar in retirement," says Leib.

advertisement

Show Bankrate's community sharing policy
          Connect with us
MORTGAGE HOME EQUITY AUTO CDs CREDIT CARDS
Product Rate Change Last week
30 year fixed, 0 point 4.30%  0.13 4.43%
15 year fixed, 0 point 3.30%  0.03 3.27%
5/1 ARM 3.34%  0.12 3.46%
 
View Rates in your area Next
Product Rate Change Last week
30K FICO-based HELOC 4.38%  0.09 4.47%
50K FICO-based HELOC 4.11%  0.06 4.17%
100K FICO-based HELOC 3.96%  0.03 3.93%
 
View Rates in your area Next
Product Rate Change Last week
60 month used car loan 2.63%  0.10 2.73%
48 month used car loan 2.90%  0.07 2.97%
60 month new car loan 3.17%  0.05 3.22%
 
View Rates in your area Next
Product Rate Change Last week
1 Year CD 0.90%  0.01 0.91%
2 Year CD 1.09% --0.01 1.08%
5 Year CD 1.74% --0.00 1.74%
 
View Rates in your area Next
Product Rate Change Last week
Balance Transfer Cards 15.66%  0.01 15.67%
Cash Back Cards 16.36%  0.03 16.33%
Low Interest Cards 10.87% --0.00 10.87%
 
Next
advertisement
CD & INVESTING NEWSLETTER

Learn the latest trends that will help grow your portfolio, plus tips on investing strategies. Delivered weekly.

Blog

Jennie Phipps

Stock gains send IRAs soaring

Fidelity Investments says IRA contributions set a record for the 2013 tax year.  ... Read more

advertisement
Partner Center
advertisement

Connect with us