Retirement & Financial Planning Report

Social Security benefits differ in several ways from civil service retirement benefits, with one prominent difference being that while in civil service retirement, benefits begin almost immediately on retirement in almost all cases and the benefit levels aren’t affected by any delay in receiving benefits, under Social Security, a beneficiary can choose when to begin benefits and beginning them either earlier or later than the "full retirement" date (currently age 66) will reduce or increase benefits.

Under Social Security, benefits typically can begin at any time between age 62 and age 70 at the beneficiary’s discretion. The reduction for starting benefits before full retirement age and the addition for waiting until after that age are designed so that on average, the total benefits paid will come out to be about the same.

SSA does not recommend taking benefits at any particular age, considering that a personal decision that varies according to circumstances. Some of those considerations could be:

* Do you come from a long-lived family? How long do you expect to live? If your parents and grandparents all lived into their 80s or 90s and you have every reason to believe you will, too, you may want to delay starting your benefits until full retirement age or later. You may need the extra money more in later years, particularly if you outlive other pensions or annuities that may have limits on how long they are paid.

* Are you still working? If you plan to continue working, there are limits on how much you can earn each year between age 62 and full retirement age and still get all your benefits. Depending on the amount of your benefit and the amount of your earnings for the year, you may have to give up some of your benefits. If your earnings will be high, waiting until full retirement age to start your benefits may be a better choice. Once you reach full retirement age, there is no longer any limit on how much you can earn.

* How is your health? If you are not in good health, you may want to start your benefits earlier.

* Do you have other income to support you if you decide to delay taking your benefits? If you don’t need your benefits immediately, you may want to wait beyond full retirement age and take advantage of the delayed retirement credits.

* Will other family members qualify for benefits with you on your record? If your spouse or minor or disabled children will qualify for benefits with you, the value of their benefits, added to your own, may extend your break-even points. This may make taking your benefits sooner more advantageous.

Remember, even if you delay starting your benefits, be sure to contact Social Security about three months before you turn age 65 to check about applying for Medicare.