COVID-19 changed just about everything in America — include the way we plan to retire.
Instead of taking Social Security later in life, 3.1 million Americans aged 55 or older now say they will apply for benefits sooner than they planned to before the pandemic, according to U.S. Census Bureau findings.
On the other hand, 1.4 million people in that age group now plan to work longer than they previously expected to, thanks to the pandemic.
Do the math, and the result is a net of about 1.7 million extra early retirements, which could be a boon for younger workers hoping to move up into higher-ranking jobs.
The data came from the Census Bureau’s Household Pulse survey conducted March 3-15.
Those who plan to retire early may get a few extra years of enjoyment out of their golden years, but it will come at a price. Teresa Ghilarducci, professor of economics at the New School for Social Research, tells Bloomberg:
“In a good economy, older workers can work and claim later; in a bad economy, older workers are pushed out into the arms of Social Security. Claiming early means a lifetime permanent cut in monthly benefits for you and your spouse and survivors.”
In the past, we have made the same point. For every year you hold off past full retirement age before claiming Social Security, your benefit will jump by as much as 8%. You can learn more in “7 Reasons You Should Not Claim Social Security Early.”
The Census Bureau survey also brought more bad news for the city of New York. A net of about 300,000 people there expect to apply for Social Security earlier than previously planned — far more than other large cities such as Philadelphia (85,000) and Chicago (68,000).
Since the coronavirus pandemic began, the Big Apple has witnessed a wave of residents leaving the city for new climes. The news that so many New Yorkers plan to leave their jobs might not bode well for a city already concerned about losing professional talent.
How to make informed Social Security decisions
For many retirees, choosing when to apply for Social Security benefits is among the most important choices they will make in their golden years. If you are struggling with this decision, stop by Money Talks News’ Solutions Center and check out “A Simple Way to Maximize Your Social Security.”
There, you’ll learn about Social Security Choices, one of a handful of companies that provide a personalized analysis of various claiming strategies. While most charge in the $50 range, Social Security Choices sells its product for $39.99. But Money Talks News readers can do better.
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