Pros and Cons of waiting to take Social Security. Are you on the fence about waiting to take your social security? Just like for every decision, there are pros and cons to making that decision. In this video, Nolan Baker and Chaz Price discuss what they consider to be the pros and cons of waiting to take social security.

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When it comes to retirement planning, Social Security is an essential component for many individuals. However, the decision of when to begin receiving Social Security benefits is not always straightforward. One can choose to start receiving benefits before reaching full retirement age or wait until later. Let’s explore the pros and cons of waiting to take Social Security.

Pros:

1. Increased benefit amount: The most significant advantage of delaying Social Security is the increase in the benefit amount. By waiting, your monthly benefit will grow by a certain percentage until you reach age 70. This increase can be as much as 8% per year for each year you delay taking benefits between full retirement age and age 70. Consequently, waiting to claim Social Security can result in a more substantial monthly income during retirement.

2. Protection against inflation: Social Security benefits are adjusted annually to account for inflation through the Cost-of-Living Adjustment (COLA). By delaying benefits, you’ll receive a higher base amount, leading to more substantial future COLA increases. This can help protect against the erosion of purchasing power due to rising prices over time, ensuring a more comfortable retirement.

3. Enhanced survivor benefits: When a spouse or dependent benefits from your Social Security record, they may receive a higher amount if you’ve waited to claim. By maximizing your own benefit, you also increase the potential survivor benefits for your loved ones. This can be particularly advantageous if your spouse is younger or anticipated to outlive you.

Cons:

1. Foregone income: One of the main disadvantages of delaying Social Security is the income foregone during the waiting period. If you are in immediate need of funds or anticipate a shorter lifespan due to health concerns, waiting to take Social Security may not be the most suitable option. It’s crucial to consider your current financial situation and carefully evaluate if deferring benefits is financially feasible.

2. Uncertainty surrounding political or legislative changes: Social Security’s future is not entirely immune to political or legislative changes. While it remains a crucial safety net for retirees, there is an ongoing debate about its long-term sustainability. Waiting to take Social Security means living in uncertainty and being susceptible to potential changes in the program. It’s advisable to stay informed about any proposed changes and adapt your retirement plans accordingly.

3. Unknown personal lifespan: Predicting one’s lifespan is near impossible, making the decision of when to start receiving Social Security a challenging one. If you delay claiming benefits, you may end up receiving fewer overall payments if your lifespan is shorter than expected. On the other hand, starting earlier may provide more income if you live longer. Considering your family history, health, and lifestyle factors can help inform this decision, but it remains uncertain.

Ultimately, the decision of when to take Social Security benefits varies based on individual circumstances, financial goals, and personal preferences. It is beneficial to consult with a financial advisor or Social Security representative who can assess your unique situation and provide guidance tailored to your needs. By carefully weighing the pros and cons, you can make an informed decision that aligns with your retirement plans and financial well-being.