A recent article by FOX Business provided the below listed percentages for how much your Social Security Benefit is reduced by claiming early. Before you claim early, it is important to realize that these reductions can be pretty significant. For example, in the case of someone claiming Social Security at age 62, their benefit can be reduced by as much as 25%. That’s a lot money lost towards your annual income. So, accordingly, think carefully before taking your benefit early.

Percent of Social Security Benefit lost by claiming early:

at age 62 - benefit reduced by about 25%
at age 63 - benefit reduced by about 20%
at age 64 - benefit reduced by about 13.3%
at age 65 - benefit reduced by about 6.7%

Now, when you contrast this with the fact that each year you wait past your full retirement age your benefit will increase by 8% a year, you can see why it pays to delay taking Social Security. Not only by waiting to claim at age 70 did you gain 8% per each year you delayed, but you did not lose 25% of your full retirement age benefit. To provide a rough example, if your benefit was $2,000 per month at full retirement age, it would be reduced to $1,500 per month if you claim at age 62, or rise to approximately $2,600+ if you wait to age 70.

If you have questions about when it is best to claim your Social Security Benefit, please feel free to contact Intelligent Investing at www.mynmfp.com/new-clients for a no-obligation consultation.

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