When is the best age to file for Social Security?
According to KSL, In today’s financial landscape, making the right decision about when to file for Social Security is more crucial than ever. You only get one chance to get it right—once you file, your decision is final, and this choice has recently become more complex, particularly if you plan to rely on Social Security through 2035 and beyond.
Insights from Experts at B.O.S.S. Retirement Solutions
Tyson Thacker and Ryan Thacker, from B.O.S.S. Retirement Solutions, recently highlighted significant changes regarding Social Security filing and provided guidance for Utah residents on maximizing their benefits. As CEO and president of B.O.S.S. Retirement Solutions, with six offices along the Wasatch Front, the Thackers have authored “The B.O.S.S. Retirement Blueprint” and have assisted countless families in optimizing their Social Security benefits.
What Has Changed with Social Security?
“We’re rapidly approaching the edge of the cliff,” explains Tyson Thacker, referring to the Social Security Trust Fund’s recent confirmation that it is projected to run out of money in less than ten years.
For retirees today, with lifespans extending 20 to 30 years or more, this means Social Security benefits could face significant reductions during retirement, potentially resulting in a 17% or larger cut in monthly income.
“This could be devastating,” Ryan Thacker adds, especially for retirees on a fixed income who depend on Social Security to cover their expenses. He emphasizes that there are now “old” and “new” methods for filing benefits, indicating that the rules have fundamentally changed.
The Complexity of Filing for Benefits
Filing for Social Security benefits has always been intricate, more so than many realize. According to a Forbes article, there are 2,728 rules in the Social Security handbook, along with thousands of additional sub-rules, often expressed in complex terminology that can be difficult to understand.
This complexity makes it challenging to determine the optimal age to file, particularly with the looming threat of benefit reductions. If benefits could be cut in the near future, how does that influence your filing age?
“Many people are making this critical decision without the necessary information,” Tyson Thacker warns. “It’s advisable to seek assistance from a professional who understands your unique situation.”
Financial Implications of Filing for Social Security
Choosing when to file for Social Security could be one of the most significant financial decisions in your life. For those with average earnings, benefits can accumulate to several hundred thousand dollars over a lifetime. For above-average earners, they could exceed $1 million.
Also read: Here’s how SSDI payments will increase for disability beneficiaries
The timing of your filing could lead to a difference of six figures in lifetime income. This highlights the importance of not taking this decision lightly. “Research shows that 96% of Americans miss out on an average of $111,000 in total benefits due to filing mistakes, including timing errors,” says Ryan Thacker. “This money is rightfully yours, and $111,000 can greatly impact your retirement.”
Rethinking Conventional Wisdom
The traditional approach to filing for Social Security has changed dramatically. Previously, the primary goal was to maximize the monthly benefit amount. However, Tyson Thacker points out that “everything is interconnected.” Filing for Social Security may affect not only your benefit amount but also your tax liabilities on those benefits, your IRA and 401(k) withdrawals, and spousal benefits, as well as your Medicare premiums.
Thus, the decision extends beyond the size of your benefits check. You must consider how all these elements interact; otherwise, you might end up with less net income.
In some cases, filing early could even result in more net income from Social Security, particularly if benefits are cut during your retirement due to the Trust Fund’s depletion.
No One-Size-Fits-All Strategy
While discussing Social Security filing with friends and family may seem beneficial, it can lead to misguided conclusions. The myriad factors involved—such as your health, life expectancy, income sources, retirement expenses, taxes, spousal benefits, inflation, Medicare premiums, and the Social Security Trust Fund’s status—make it clear that a one-size-fits-all approach is not feasible.
Ultimately, seeking professional help to determine your optimal filing age is advisable. Experts who specialize in this area can guide you through the complex factors that affect your net benefits.
Free Customized Social Security Analysis
To assist individuals in navigating this complicated decision, the Thackers and their team at B.O.S.S. Retirement Solutions are offering a free, customized Social Security Analysis.
This analysis simplifies the process by pinpointing the best time for you to file, considering potential impacts on taxes, IRA and 401(k) withdrawals, investment income, spousal benefits, and Medicare premiums.
While some advisors charge hundreds of dollars for similar analyses, B.O.S.S. Retirement Solutions provides this service for free, even if you are not a client.
This offer is particularly beneficial for families who have saved over $200,000 for retirement and have not yet filed for Social Security.
To schedule your complimentary analysis that could maximize your Social Security benefits, call 801-990-5055 or request your free Social Security Analysis online.
