Dear Retirement Adviser,
I’m 63 years old and have been diagnosed with rheumatoid arthritis. I lost my job in 2012 and have been unable to find another one. My unemployment insurance is about to run out. I do have an individual retirement account with some savings. If I try to wait until I’m 64 before filing for Social Security, will there be a cost-of-living increase, or will the payment amount be the same for the rest of my life?

— Joyce Juncture

Dear Joyce,
It is true that your Social Security retirement benefits are permanently reduced when you start receiving them prior to your full retirement age. The good news here is that reduced benefit amount is subject to a cost-of-living adjustment every year.

The longer you wait to file for benefits, the smaller the benefit reduction will be. It might make financial sense to use some of your retirement savings upfront to delay the date when you start receiving retirement benefits.

Your full retirement age is 66. If you start receiving Social Security retirement benefits at age 64, you’ll get nearly 87 percent of your primary insurance amount. If you can hold out until age 65, that goes up to 93 percent.

You didn’t mention your marital status. If you qualify for spousal benefits as a divorced spouse, that could change your strategy toward timing taking Social Security benefits.

It’s possible that you may qualify for Social Security disability benefits based on your rheumatoid arthritis. You should pursue this option if you are unable to work because of your condition.

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