The timing of when you begin collecting Social Security benefits can affect how much your payments are, according to the Consumer Financial Protection Bureau. The CFPB is advising consumers to consider waiting to collect Social Security retirement benefits. More than one-third of consumers begin collecting benefits at age 62. However, according to the bureau, monthly payments can increase up to 75 percent if consumers wait until the age of 70 to collect.
Online tool. The bureau developed a nifty new tool to help consumers decide when to begin collecting Social Security. The online interactive “Planning for Retirement” tool allows consumers to estimate how much money they can expect to receive at different ages and provides tips to help consumers evaluate the trade-offs. The tool also helps consumers consider the relationship between claiming age and other related factors, such as marital status, other expected sources of income, plans for working after age 60, and general expectations of longevity.
In prepared remarks for an appearance at the Brookings Institution, CFPB Director Richard Cordray said that the CFPB worked closely with the Social Security Administration to develop the retirement tool. When designing the tool, the CFPB looked at changing trends and how different consumers access information. Cordray said the tool is optimized for mobile use. There is a Spanish version of the tool because Spanish speakers are expected to be one of the fastest-growing segments of the population that will be making the claiming decision by 2050.
Social Security benefits. Americans are eligible to claim Social Security retirement benefits without any reduction at their “full retirement age,” according to the Social Security Administration. For people born after 1942, full retirement age ranges from 66 to 67, depending on the year the person was born. Consumers also can claim their benefits several years before, agreeing to take less money each month, or they can claim several years after, and get bigger monthly checks. Generally, the amount a consumer receives from Social Security is a one-time choice, the CFPB said. The only changes to the payments are annual cost-of-living adjustments. This is why, the bureau said, choosing when to begin collecting should be a carefully made decision.
Issue brief. An issue brief by the CFPB on the link between claiming age and retirement security indicates that many consumers may not be taking advantage of their option to receive higher Social Security income. According to the brief, many Americans are collecting earlier but are living longer. In 2013, nearly 46 percent of claims were submitted at age 62. But, on average, Americans reaching age 65 today will live to age 85. Consumers will need sufficient income and savings to cover 20 years or more in retirement.
The brief also states that many Americans are unprepared financially for retirement, even those nearing the retirement age. According to the CFPB, four in 10 Americans aged 51 – 59 are reaching retirement with little or no savings. Retirees rely on Social Security benefits with the decline in coverage from traditional pension plans. Approximately two thirds of the nearly 40 million Americans aged 65 and older who receive Social Security benefits depend on them for 50 percent or more of their retirement income.
Online tool. The bureau developed a nifty new tool to help consumers decide when to begin collecting Social Security. The online interactive “Planning for Retirement” tool allows consumers to estimate how much money they can expect to receive at different ages and provides tips to help consumers evaluate the trade-offs. The tool also helps consumers consider the relationship between claiming age and other related factors, such as marital status, other expected sources of income, plans for working after age 60, and general expectations of longevity.
In prepared remarks for an appearance at the Brookings Institution, CFPB Director Richard Cordray said that the CFPB worked closely with the Social Security Administration to develop the retirement tool. When designing the tool, the CFPB looked at changing trends and how different consumers access information. Cordray said the tool is optimized for mobile use. There is a Spanish version of the tool because Spanish speakers are expected to be one of the fastest-growing segments of the population that will be making the claiming decision by 2050.
Social Security benefits. Americans are eligible to claim Social Security retirement benefits without any reduction at their “full retirement age,” according to the Social Security Administration. For people born after 1942, full retirement age ranges from 66 to 67, depending on the year the person was born. Consumers also can claim their benefits several years before, agreeing to take less money each month, or they can claim several years after, and get bigger monthly checks. Generally, the amount a consumer receives from Social Security is a one-time choice, the CFPB said. The only changes to the payments are annual cost-of-living adjustments. This is why, the bureau said, choosing when to begin collecting should be a carefully made decision.
Issue brief. An issue brief by the CFPB on the link between claiming age and retirement security indicates that many consumers may not be taking advantage of their option to receive higher Social Security income. According to the brief, many Americans are collecting earlier but are living longer. In 2013, nearly 46 percent of claims were submitted at age 62. But, on average, Americans reaching age 65 today will live to age 85. Consumers will need sufficient income and savings to cover 20 years or more in retirement.
The brief also states that many Americans are unprepared financially for retirement, even those nearing the retirement age. According to the CFPB, four in 10 Americans aged 51 – 59 are reaching retirement with little or no savings. Retirees rely on Social Security benefits with the decline in coverage from traditional pension plans. Approximately two thirds of the nearly 40 million Americans aged 65 and older who receive Social Security benefits depend on them for 50 percent or more of their retirement income.
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