As you approach the age when you can receive Social Security benefits, you have options to consider and decisions to make. Here are some things to consider, as once an option is selected, there is no turning back:

• At what age, from 62 - 70, do I want to start receiving benefits?
• Do I want to delay receiving benefits beyond standard retirement age?
• Do I plan to continue working once I chose to start receiving benefits?
• Will my decision affect the benefits of my spouse and survivng dependents?

Research has shown that many Americans are losing valuable Social Security benefits for themselves and their spouses. Many people say they plan to start benefits before the standard retirement age, yet they also say that the rate of spousal and survivor benefits is a high priority. This is a contridicition, because spousal survivor benefits are actually lowered when benefits are started early.

You can start Social Security as early as age-62, regardless of your birth year. You are entitled to full benefits at your standard retirement age which varies depending on your year of birth. Those born1937 and earlier that is age-65 and is on a sliding scale until those born in 1960 or later. The highlights of the scale are those born 1943-1954 will have to wait until age-66 and those born 1960 and later will have to wait until age-67 for full benefits. If one would normaly receive full benefits at age-65 and they elect early benefits at age-62, benefits will be reduced 20% and one who normaly receives full benefits at age-66 would have a 25% reduction for taking early benefits at age-62. These lower benefits continue for the remainder of your life and most importantly will also effect the benefits a surviving spouse would receive.

On the opposite end, if you postpone receiving full benefits at your standard retirement age and were born 1943 or after, you will recivie an 8% per year bonus, plus the usual 2-3% per year the government adds for inflation/cost of living raises. The breakeven age between starting benefits early or postponing until full benefits are paid is age-78. If you live past that and many people do, as age-85+ is the fastest growing segment of the population, you will be way ahead. Studies show that if you are now age-62, you have a 50% probability of living to age-82. Therefore, there is a 50% chance you will live beyond the median life expectancy and an even greater chance you will live past the breakeven age of 78. When making this decision, you have to consider your present health condition. If you are very healthy, you might want to postpone until full benefits will be paid or somewhere in between. If you have health problems and they are the type that could worsen between early and full benefit ages then you might want to start benefits as soon as possible. If you are the spouse with the larger benefit amount and have a younger spouse, you also would want to consider postponing as long as possible until at least full benefits are paid. These decisions do not effect Medicare benefits which can still be recieved in full at age-65.

If you sart benefits early and continue working, you will be penalized. In the years before you reach full benefit age, $1 in benefits is deducted for every $2 you earn above $ 14,160.00 in 2009. Once you reach full benefit age, there is no penalty and you can earn as much as you want.

Each spouse is entitled to the benefits they qualify for on their own or 50% of their mates, whichever is greater. At the death of the first spouse, the surviving spouse will receive the higher of the two benefits and the lower amount will disappear. Therefore, if possible (again, depending on health situations), it is generally better for the person who will receive higher benefit amounts to wait until full benefit age. The result would be higher lifetime benefits if normal life expectancy or longer is acheived and the surviving spouse could also end up receiving more monthly income from the increased benefit amount. Before you start your benefits early, consider all the options and possibilities. 

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