Social Security: Waiting Until Later is Like Getting a Second Pension


Susan Kasik is an office manager and will be 62 soon. She is considering retiring. Susan is healthy and ok with her job, but she just wonders if she can move on now to a life of days doing whatever she likes and nice vacations.

But Susan will probably live a really long time. Her statistical life expectancy is 85 years. Half of women her age will live longer. Being healthy and relatively affluent, Susan is particularly likely to exceed the average. Does she have the financial resources to live 30 more years in retirement?

At 62 Susan can begin to take Social Security but should she wait? She has an IRA that is over $500,000 and no mortgage, but Social Security will be an important part of her income and financial security. Lets look at how much more Susan gets if she waits to retire at age 70 when she can get the maximum benefit.


Waiting to 70 Pays an Additional Benefit: It is like Having an Extra Pension

The extra $1,132 a month Susan will get amounts to $13,584 a year. She would need another IRA account with $250,000 in it to get that kind of income if she doesn’t wait. The Best part; this is a real diversification from stocks and bonds that she doesn’t have to manage or do anything sbout.

*Illistration is Hypothetical. After age 80, Susan will have received more in total benefits by waiting until 70. By the age of 95, she will have received $196,222 more than if she had begun to draw at age 62.