Most people don't realize how much money they give up by claiming benefits at age 62. For example, consider a woman entitled to a monthly benefit of $1,500 at her full retirement age of 66. Assuming she lives to age 95 and receives cost-of-living adjustments (COLAs) of about 2.3%, she would receive $728,665 over the course of her retirement. Her final monthly benefit payment would be $2,827.
Compare that to retiring early at age 62. She'll lose $55,437 in Social Security income. Her starting benefit will be permanently reduced by 25% to $1,225, and even with receiving benefits over more years she'll receive only $673,228 over the course of her retirement. Her final benefit would be $2,438.
If she delays until age 70, she'll receive $62,226 more because of the Social Security delayed retirement credit. Her starting benefit will be $1,980, she will receive $790,891 over her retirement, and her final monthly benefit would be $3,417.
For more tips like these to save on your Medicare costs and to maximize your Social Security benefits, sign up for The Senior Citizens League's Social Security & Medicare Advisor newsletter here or call 1-800-333-8725 for more information.
Reprinted with permission from The Senior Citizens League,1001 N. Fairfax St. #101, Alexandria, VA 22314, www.seniors.league.org, 1-800-333-8725.