The 3 best ages to claim benefits for Social Security

Whether you are already retired or planning to retire at some point in the future, the data is not there: Social Security has a good chance of helping you make ends meet.

According to data from the Social Security Administration, more than 3 in 5 retirees make use of the program to make up at least half of their monthly income. Meanwhile, two separate polls from Gallup found that 90% of current retirees and 83% of future retirees will rely on Social Security as either a "major" or "minor" source of income. This means that deciding when to take Social Security may just be the most important decision seniors make.

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Your alleged age has a large large impact on how much you want to receive from Social Security

Although there are a number of factors that can affect how much seniors are paid by Social Security, including work history , earnings history and year of birth, it is your alleged age that can have the biggest impact on your monthly and lifetime payments.

As you may already know, Social Security allows qualified retirees to start taking their benefits at the age of 62, or any point thereafter. The catch is that the program provides patience. For every year a person is making the payment, it will grow by about 8% up to 70 years.

Everything is the same ̵[ads1]1; work history, earnings history and year of birth (which determines full retirement age) – a person claiming at age 70 could receive a monthly payment up to 76% higher than someone claiming as early as possible in The age is 62. The exchange is that those who require 62 years could receive a (reduced) payment for up to eight years before the individual at the age of 70 receives their first payment.

Trying to figure out which assertion strategy works best for your situation is not easy, especially given that we do not know the expiration date, and there is no specific guide that works for everyone.

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The top three age groups to take your Social Security benefit

However, a new study from United Income took a hard look at Social Security and claimed data from the University of Michigan's Health and Retirement Study (HRS) to determine the age at which taking social security benefits was optimal. The results showed an almost perfect inversion of when people are taking advantage over when to take them.

According to the analysis from United Income, only 6.5% of older households included through HRS would have made an optimal and claimed choice by making the payment at age 62, 63 or 64. Still had close to 4 out of 5 older households that were analyzed took the payment before they turned 65. In layman's terms, these early claimants had ended up leaving a lot of money on the table, at least in hindsight.

At the other end of the spectrum, United Income was able to identify a handful of ages that maximized what creditors received during their lifetime. The data showed that 57% of the elderly had better wait for 70 years to make the payment, with around 10% benefiting from 67 years of claim, and only 10% from the age of 69. And yes, if you're curious, age 68 was the fourth most optimal claim age. In fact, more than 4 out of 5 seniors will be best off waiting until age 67 or later to start taking advantage of them. And as a reminder, the age of 67 is full retirement age for anyone born in 1960 or later.

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Your claim strategy is a bit of science and luck

Although the data is pretty clear that overwhelmingly seniors would be better off waiting to get their Social Security benefits, the fact remains that this proposal will not work for everyone. That's because none of us know (fortunately) our expiration date in advance, which is an important piece of information if we are to maximize our lifetime payout from the program.

For the elderly to have the best chance of maximizing their lifetime, they must really think about the variables that matter most to them. This involves taking into account your health history, financial situation (ie need for immediate income) and marital status, to name a few factors.

For example, if you have excellent health; has no chronic health conditions; and have close family members, such as parents, who have lived far into the 80s, if not longer, science would suggest that you have a long life on your side. This means that a later claim on the insurance should give you the best chance of maximizing your monthly and long-term payment.

But some luck is also involved. Without knowing the expiration date, we simply will not know if we made an optimum decision decision until well after. All we can say for sure, at least from United Income & # 39; s analysis via HRS, is that too many seniors claim Social Security benefits early, and as a result, a lot of money was left on the table.