On Delaying Social Security Benefits

Over seven out of every ten Americans receive their Social Security checks as soon as possible, often at age 62. However, by delaying the start of benefits, you may receive more money and enjoy a better retirement.

To see how this might play out, consider three workers who can retire at 62 with a monthly check of around $750. One takes the early payment; one waits nearly four years, when monthly payments begin at $1,000 per month; the third worker waits until 70, for a maximum benefit of around $1,300 a month.

Assume all three workers live until age 90. Here are the results, before any inflation adjustments:

* Starting at age 62, this worker receives about $250,000 in total benefits.

* Starting closer to 66, the second retiree receives around $290,000.

* Waiting until age 70 to start, in 20 years this worker receives over $310,000 from Social Security. Even factoring in the time value of the early payments, this worker will come out ahead if benefits continue past age 87. Taking a later payout at a higher rate also will produce a better result for a surviving spouse.