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Data to End Hunger: Social Security - It Pays to Wait

Editor's Note:  Institute Notes is grateful to Kristen Arnold and her colleagues at the National Academy of Social Insurance, here in Washington, DC, for today’s guest blog post. It’s an excellent example of simplifying, but not over-simplifying, data to present what people should know. People at risk of hunger and poverty need access to data on a variety of issues along with succinct explanations of why the information is important - and Social Security is certainly one of the most important of these issues.  

Photo for Social Security

Photo by Lindsay Benson Garrett/Meals on Wheels.

 Social Security is more than a number; it’s also America’s most powerful poverty-prevention program. Social Security benefits kept more than 22.1 million people out of poverty in 2012.

These data are interesting, but how can Social Security help you fight poverty on a personal level? On Social Security, knowledge can truly pay.

How does that work? If you’re thinking about retiring, you should know that every month you delay Social Security between 62 and 70 will increase your monthly benefit for the rest of your life. Waiting until 70 will increase it by 76%. That’s a big difference. Waiting even a year or two — if you can — can make a difference in how comfortably you’ll be able to live in retirement.

The National Academy of Social Insurance is a nonprofit, nonpartisan organization that educates policymakers and the public about Social Security, Medicare and other social insurance programs.  It also produces unbiased educational resources for individuals.

     When to Take Social Security: It Pays to Wait is a new toolkit that empowers workers nearing retirement to make informed decisions about when to take Social Security retirement benefits.

     The toolkit’s fact sheet, 16-page brief, and 3-minute video explain key messages:

      1) It pays to wait to take Social Security. If you can wait, even a year or two, your monthly benefit will be higher – for the rest of your life.

There are financial benefits if you can wait to start your benefits at or after your full   retirement age. Your benefit is reduced if you take Social Security before your full retirement age, and is increased for every month after full retirement age that you wait to claim, until age 70. If you wait until 70, your Social Security benefit will be 76% higher than if you started taking benefits at 62.

2) If you need Social Security to make ends meet, take it – you’ve earned it.

Social Security is there for you, and you can take it as early as age 62 if you need it to prevent financial hardship.

      3)If you’re married, you have two lives to plan for. If you are the higher earner, waiting to take Social Security provides a higher survivor benefit for your spouse if she or he outlives you.

     A widow can receive Social Security based on her husband’s work record if that benefit is higher than what she would receive based on her own work. Any increase in the husband’s benefit because he delayed claiming is passed on in the survivor benefit for his widow after he dies. (If the wife is the higher earner, waiting to take her benefit will increase survivor benefits for her husband if he outlives her.)

Social Security is the most important source of income for most retired Americans. Understanding the financial impact of waiting to take Social Security benefits could help you and your loved ones stay out of poverty in retirement.

Kristen Arnold is the Income Security Program Analyst at the National Academy of Social Insurance, where she develops strategic partnerships and new outreach initiatives and contributes to research on Social Security and Unemployment Insurance.

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