• Sources of Income in Retirement
• Using Your Money Once You Retire
• Starting Social Security Payments

Starting Social Security Payments

In today’s constantly-changing environment, it’s easy to feel insecure about your retirement.

But there are some things you can control — like when to start your Social Security benefits. And since that decision affects the amount of benefits you receive, you can control that too.

How do I decide?

When to start Social Security payments is a big decision, but it doesn’t have to be complicated.

If you take benefits before your normal retirement age, you will receive a lower payment. But the extra years you would receive benefits may make up for the fact that the payments are lower.

Figuring your break-even age will help you determine whether the extra payments you receive by starting early outweigh the higher payments you would receive by starting later.

When will I break even?

Use the Social Security Web site’s break-even age calculator to help decide when to begin receiving benefits. It compares the present value of receiving benefits at different ages to determine your break-even age. 

To use the tool, you’ll need your benefit amount at the retirement ages you want to compare. There are a couple of ways to get that information:

• Get your Social Security Statement
• Get an estimate of your monthly benefit

Now for the hard question

Once you find your break-even age, consider your life expectancy. Are you in good health? What’s your family history for longevity? Do you have dangerous hobbies? These are things that we don’t want to think about, but they should be considered when making this decision.

If you expect to live longer than your break even age, you may want to consider delaying the start of your retirement benefits. If you don’t expect to reach your break even age, you may want to consider starting your retirement benefits earlier.