While many older Americans look forward to their retirement years with great anticipation, a substantial subset of the aging population is struggling to prepare for retirement and is deeply concerned about the financial realities of this later stage of life, according to a new study conducted by The Associated Press-NORC Center for Public Affairs Research.
Even now, financial planners are urging people to work to 70, so they end up with more spending money than if they retire at the full retirement age of 66, or even earlier at 62. At 62, people can get small Social Security benefits, but each year they wait increases their monthly check about 8 percent. According to Munnell's research, retiring at 62, rather than 70, cuts the monthly benefit almost in half. A person who would receive a monthly Social Security check of $1,000 upon retiring at 70 would get $568 at 62. That's been a huge selling point for waiting to retire.
I can start collecting Social Security Benefits any time from age 62 to 70. The earlier I take them, the less my benefit will be, so there is some strategy to deciding when to pull the trigger. I want to figure out the ideal time to do it, and I'm also curious how much money I would have had to save up to provide the same stream of income that Social Security will provide. So I did a little calculating to see how much difference it makes.
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