DEAR SAVVY SENIOR:
Are there any services that you can recommend that help pre-retirees decide when to start drawing their Social Security benefits? My wife and I are still a few years away from retiring but want to carefully weigh all our options to make sure we get the most from our benefits.
Deciding when to begin collecting your Social Security benefits could be one of the most important retirement-income decisions you'll make. The difference between a good decision and a poor one could cost you tens of thousands of dollars over your retirement, so doing your homework and weighing your options now is a very smart move.
What to consider
As you may already know, you can claim Social Security any time from age 62 to 70, but the longer you wait, the larger your monthly check. However, there are many other factors you need to take into account to help you make a good decision, like your current financial needs, your health and family longevity, whether you plan to work in retirement, whether you have other retirement income sources and if you're married, your spouse's situation.
You also need to understand the dizzying array of rules that can affect your Social Security benefits.
To help you compare all your options, there are a number of online tools and services that have sprung up in recent years that can help you make an informed decision.
To get started, your first step is to go to the Social Security statement Web page (socialsecurity.gov/mystatement) and get your personalized statement that estimates what your retirement benefits will be at age 62, full retirement age (currently 66) or when you turn 70. These estimates are based on your yearly earnings that are also listed on your report.
Once you get your estimates for both you and your wife, there are several online tools you can turn to that can crunch hundreds of calculations to compare your benefits under various scenarios and different ages to help you figure out your optimum claiming strategy.