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The best Social Security Age involves a choice between two income streams. Calculating the break even point will help determine when you should start drawing Social Security.
SSA is there to help you identify your best Social Security age by calculating your break even point online.
Go to www.ssa.gov and keyword-search on break even age to find the page. Or click on this link.
SSA claims that in the long-term it does not matter when you start drawing Social Security as long as you do so before age seventy. After all, benefits are calculated from statistical lifespan models. The amount received over an actuarial lifetime will be the same whether you are an early-bird, a late-comer, or an on-time Jane or Joe. Each Social Security age is equally as good.
While the actuaries might insist the when makes no difference, in reality it does matter. The best time to start taking retirement benefits boils down to a choice between two income streams: a smaller, longer-lasting one for those who start early and a larger, shorter-lasting flow for those who jump in late. Which stream is worth more? The answer differs for everyone.
To determine your best starting-time, consider three factors: your actuarial break even point, your personal circumstances, and any tie-ins with the Social Security benefits of other family members. SSA-online can help you with calculating the break even point. The other two factors are more personal.
The break even point is the moment in time where the two income streams become equal. At your break even age, the accumulated value of higher benefits from postponing retirement will start to exceed the accumulated value of lower benefits from choosing the early option. If you expect to live beyond this age, it would be to your advantage to delay your retirement benefits until that point.
To use an online Social Security tool for calculating your break even point, click on this link.
Topic: Social Security
Subtopics: Introduction Social Security as Typical Retirement Income The Importance of Credits Social Security Age History of Retirement Age Calculating Social Security Benefits Spousal & Survivor Benefits Reduction in Benefits from Work Income & Benefits Windfall Elimination Provision Government Pension Offset When to Retire? The Break Even Point When? Personal Circumstances When? Family Circumstances Earnings Statement & Benefits Calculator Income Tax on Social Security Tax Examples Social Security Problems Social Security Solutions Tips from SmartMoney Tips from Wichita Falls