According to a recent Gallup survey, 36% of pre-retired Americans will depend on Social Security as a “major source” of retirement income. That’s about 10 percent higher than a decade ago. Combined with the recent Wells Fargo survey that revealed less than 30% of workers believe they will have enough savings to retire, it would seem to make sense that Americans would consider delaying Social Security to get more money.

Of course, if you’ve read much in the media about Social Security, you know that the best way to maximize Social Security is to delay claiming benefits until later. A person who would get $1,000 at a full retirement age of 66 would receive about $750 if claiming at age 62 (the earliest age at which most people can claim benefits). But that same $1,000 grows to about $1,320 at age 70.

I cringe when I read that, according to the Social Security Administration, over 70% of those receiving benefits had elected to begin early. Why doesn’t the math – the promise of more money – stop people from claiming early?

It’s critical that Americans do these two things in order to have hope for a fulfilling retirement:

  1. You must have a plan for taking your Social Security benefits. You shouldn’t make the decision in a vacuum. You need to know what the tradeoffs are if you claim early. How much monthly cash will you be giving up? If you’re married, how will you decision impact the survivor benefit? Will your savings be enough to make up the difference?
  2. You need to coordinate how and when to take your benefits with the rest of your savings. Getting the most in Social Security means that you’ll have to rely less on your savings. Coordinating when you begin your benefits with how you spend your savings can mean your savings will last longer. Spending your savings in a tax-efficient way will let you keep even more of your savings—meaning it lasts longer.

The Gallup survey concludes: “To the degree [to which] savings are not sufficient to fund their retirement, [they] will have to make up the shortfall somehow. The guaranteed Social Security benefit is an obvious way to do that, if not by also seeking part-time work or scaling back their standard of living considerably.”

So the choice is yours. Carefully plan, consider the tradeoffs, and make an informed decision, or claim early and hope it’s enough.

Let us show you the difference in how much you can receive in benefits. The amount might be surprising. It’s not unusual for our clients to see an increase of over $150,000 in cumulative benefits between what we recommend and the plan you’re considering. Start with your FREE Social Security Snapshot. It takes less than a minute to fill in the form and get your report. Isn’t your retirement worth that much?