Maximize Your Social Security Benefits: A How-to Guide
Understanding how much Social Security income you can rely on each month, based on different scenarios, can help you develop a retirement strategy that maximizes your benefit. Keep these factors top of mind while planning:
Your age when you start drawing Social Security matters. If you were born in 1960 or later, your full retirement age—the age at which you can draw your full Social Security benefit—is 67. But you can begin drawing Social Security as early as age 62. Adults who begin drawing Social Security at age 62, however, receive a lower amount than those who wait until their full retirement age, and that reduction is permanent. If you’re in good health and can continue working, or if you’ve retired early with enough savings and other assets to sustain your income, consider waiting until your full retirement age—or even until age 70—to begin drawing your Social Security benefit.- You can collect Social Security while working without penalties once you reach your full retirement age. During this period, you can also continue contributing to your 401(k) plan or IRA.
- Social Security may not cover all of your financial needs during retirement. That’s why investing and saving are crucial.
- Resist the temptation to replace your monthly income with Social Security because you’re ready to retire. Because the age at which you begin drawing Social Security can impact the amount you receive each month, waiting until retirement age to draw, if possible, may make the most long-term sense. That doesn’t necessarily mean you have to remain in the workforce. It simply means you should look into whether or not other resources—retirement accounts, your spouse’s salary, etc.—are available and may allow you to retire without drawing your Social Security benefit.
Your age when you start drawing Social Security matters. If you were born in 1960 or later, your full retirement age—the age at which you can draw your full Social Security benefit—is 67. But you can begin drawing Social Security as early as age 62. Adults who begin drawing Social Security at age 62, however, receive a lower amount than those who wait until their full retirement age, and that reduction is permanent. If you’re in good health and can continue working, or if you’ve retired early with enough savings and other assets to sustain your income, consider waiting until your full retirement age—or even until age 70—to begin drawing your Social Security benefit.To schedule a guidance appointment with a Fidelity retirement planner, contact Fidelity Investments at 800-642-7131.