AARP and Social Security. AARP is one of the most important retirement decisions you will make is when to begin receiving Social Security benefits. Payouts increase for each year you delay claiming between ages 62 and 70. But selecting a start date is far from a simple decision.
A new AARP Social Security benefits calculator aims to help people decide when to claim retirement benefits. “It pays to wait because your benefits are going to grow,” says Jean Setzfand, vice president of financial Security at AARP. “Even waiting a year essentially buys them more in income than if they accessed it as soon as they are eligible, which is at 62.”
For example, a worker born on Jan. 1, 1955 currently earning $40,000 per year is estimated to receive $940 per month upon claiming Social Security at age 62. However, if the worker waits until age 66 to sign up, he will get $1,344 each month for the rest of his life. And if he delays claiming until age 70 he will receive the maximum possible monthly payment of $1,756. In this case, waiting to collect payments will earn the worker $816 more each month.
However, the decision about when to claim is more complicated for married couples. Spouses are entitled to benefits based on their own working record or up to half of the higher earner’s benefit, whichever is higher. Savvy couples can claim spousal benefits and later switch to their own work record, which will then be higher due to delayed claiming.
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