“I’ve been paying into this thing my whole life, and Congress continues to move the goal posts on when I can collect. I want to start this benefit as soon as I’m eligible, darnnit!” This is the most common response I get when I speak to our retiring clients about social security. It’s our job to help our clients *maximize* Social Security’s utility in creating an excellent retirement.
The old adage of “delay, delay, delay” has some merit, but I find one-size-fits-all counsel is not really advice. Advice ought to be personalized. After all, you are consulting a trusted advisor.. not Google.
Well, at E&E Wealth we believe our role is to be your personal guide through retirement. When it comes to Social Security, this means we ought to aim to optimize your Social Security decision. Life expectancy, earning histories, net worth, marital status – all these factors play a significant role, and they vary for everyone.
For example, if you and your partner have different earnings records, it may make sense for the lower earner to start receiving benefits earlier while the higher earner waits. This approach can start generating some income while potentially maximizing the long-term benefit, especially when thinking about survivor benefits.
Here’s a quick story I’d like to share with you. We have some lovely clients, let’s call them David and Lisa. David had been mostly earning for the family while Lisa had sporadic employment over the years. Following the generic advice, they initially planned to delay both their benefits. But after reviewing their specific situation, we suggested Lisa start her benefits at retirement, with David holding off until age 70.
This strategy provided them with a bit of immediate financial wiggle room and positioned them for the maximal survivor benefit over time. General financial principles are great when you don’t have a trusted advisor in your corner, but they fall short of personalized advice.
Watch this space for our next article where we will delve into retirement downsizing’s ins and outs – oh, sorry – I mean it does not always end up in a happily ever after story as some would think. Wait till then and continue to challenge the norms!
