Social Security is an important safety net for the elderly and retired population of a country. If you are nearing retirement age, you might be wondering when it would be best to retire. Ideally, everyone would retire at the full retirement age to reap the maximum monthly benefit available to them. However, this is not always the case nor is it feasible. Let’s take a look at some of the factors that will inform whether you should retire early or at the full age.
Retiring at the Full Age For Social Security
This would be the ideal way to go, you don’t risk incurring any penalties because of early retirement conflicts with income, and you’ll also be receiving the maximum monthly amount possible based on your contributions. We have to really consider what retirement means, it in some part means you are officially exiting the workforce.
This means that you will no longer be working full-time. You can still accrue income by working part-time jobs or working full-time so long as you are beneath a certain earnings threshold. For example, if you are at the full retirement age and wish to work as well, your social security amount will not be withheld up to $48,600. If you earn more than this while on SS benefits, the SSA will deduct $1 for every $3 earned.
While most concerns about retirement timing are centered around whether one should retire early, some citizens question the opposite. Due to life circumstances or a simple unwillingness to leave the workforce just yet, there are workers who wish to delay their retirement. This can also be a good idea if you are in reasonably good health and financial condition. Delaying retirement until 70 ensures you will receive the maximum payout possible for you.
When Should You Retire Early?
Despite the reduce benefits monthly from retiring early, many men and women choose to retire early. It is a highly personal choice that has many factors behind it. A person may choose to retire early for factors unrelated to money, actually, it’s often factors unrelated to money that push people to retire early. Factors such as health, family, and life circumstances will determine if someone wishes to retire before the full retirement age.
Not everyone feels the same at 60. Physical fitness, health, and ability can vary dramatically at this age. Not only that but depending on what line of work a person is in, retirement age can vary. It is considerably easier to work later into your life if you work primarily at a desk versus someone who has done very active jobs such as construction or nursing.
Consider that the reduced monthly benefits from retiring early are mostly due to the fact that you are stretching your reward out over a longer period of time.
Is It Financially Possible To Retire Early?
Your Social Security benefits should ideally not be the only form of income you possess when nearing retirement. Financial security is a big aspect of retiring early. This can vary between having family who can support you or having a nest egg or passive investments that can sustain you when supplemented with Social Security benefits.
How secure you are will determine if it is a good idea or possible to retire before the full retirement age. Interestingly, there are a fair few people who possess the financial security and are the proper age to retire, yet choose to delay retirement because they wish to continue working longer out of their own choice or have certain career goals.
Retiree Group Medical Benefits
Regardless of when you choose to retire, we at Benistar would like to ensure that retirees or those nearing retirement have ample benefits to assist them as they enter a new stage in their lives. We are national leaders and experts at the administration of medical benefits for retirees.
Contact us today if you have any questions about benefits administration or our prescription drug plans.