Why are more Americans claiming Social Security Early? Good morning and welcome back to Finance Friday. My sincerest apologies for not having a post last week. However, we are back and ready to go. We are continuing our monthly discussions regarding Federal Assistance.
Social Security claims are rising as more Americans feel anxious about personal finances and the future of the program. Some at the Social Security administration have seen a surprising increase in applications for retired worker benefits. Those eligible for Social Security Income (SSI), can begin receiving benefits at age 62, however, you aren’t entitled to receive full benefits until your Full Retirement Age (FRA) at age 67. If you delay until age 70, you receive full retirement benefits plus an additional 8% per year increase for each year until you hit 70.
So, what’s driving the increase in early claims? The Social Security Press Office highlighted 3 possible reasons:
- Baby Boom Retirees – A record number of Americans turning 65 and retiring, which is considered the largest retirement surge in history.
- The Social Security Fairness Act – The new law increases benefits for some retired public service workers while also providing back pay for others.
- Spouses and Surviving Spouses potentially entitled to a higher benefit – This is regarding Survivor Benefits.When reporting the death of a spouse, if a higher benefit is available, the SSA will adjust their payments to a larger amount.
I believe that early claims are not a direct and single indicator of the talk surrounding Social Security Benefits. Remember that every situation is different, and early claims can be due to unique health or financial reasons. It’s your personal decision when you should claim, just discuss your reasoning with your advisor or planner so they may guide you in the right direction.
Remember to submit your questions and thoughts on our discussion to hector@hrcfin.com. Also, don’t forget to follow HRC Financial on Facebook and LinkedIn for more Finance Friday Tips and Insights. Thank you again for your time this morning and have a fantastic weekend!