The decision to file for Social Security is a big one. That’s because your filing age will help determine what your monthly benefits look like.
If you’re thinking of retiring in 2022, you may also be gearing up to claim Social Security. But even if you aren’t planning to leave the workforce in the coming year, you may have your reasons for wanting to start collecting your benefits.
Either way, it’s important to weigh that decision carefully. And if these signs apply to you, you may be ready to start Social Security in the new year.
1. You’ve reached full retirement age
Full retirement age, or FRA, is the age at which you’re entitled to your full monthly benefit based on your wage history. You can claim benefits outside of FRA, but there are consequences involved — both negative and positive.
If you sign up for Social Security before FRA, which you can do beginning at age 62, your benefits will be reduced on a permanent basis. On the flipside, you can delay your filing past FRA and boost your benefits up until the age of 70, at which point you might as well claim them.
In between age 62 and age 70 is FRA, which hinges on when you were born. You can consult this table to see what your FRA looks like:
Year of Birth
Full Retirement Age
66 and 2 months
66 and 4 months
66 and 6 months
66 and 8 months
66 and 10 months
1960 or later
If you’ll be reaching FRA by 2022, or you’ve reached it already, then you may be in a strong position to claim Social Security. This isn’t to say that you can’t file for benefits before FRA — but waiting until that milestone means avoid a hit to that income stream.
2. You understand how much income to expect from Social Security
Before you file for benefits, it’s important to know what they might look like. And you can access that information by checking your most recent earnings statement — either the copy you may have received by mail or the copy you view on the Social Security Administration’s website.
You might think you’re in line for a monthly benefit of $2,000 if you file for Social Security next year. But what if your benefit is only worth $1,800? In that case, you might make the decision to delay your filing so your benefits get a boost.
3. You’ve mapped out a retirement budget
Your living expenses in retirement may look different than your costs during your working years. And it’s important to create a budget to know how much income you’ll need to support yourself. Only once you have those numbers mapped out can you make an informed decision about when to claim Social Security.
Say you determine you’ll need $3,000 a month in retirement income, but your savings will only provide $1,000 a month. If filing for Social Security in 2022 means only collecting $1,800 a month in benefits, you may decide to work a bit longer and postpone your claim so your benefits can grow.
What’s the right call?
Filing for Social Security in 2022 could end up being a smart move. But before you dive in, consider the points above. The last thing you want to do is sign up for benefits too early and regret your decision for many years afterward.
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