1. Taking Social Security early
Will Social Security be your primary source of income in retirement? If the answer is “yes,” you better think twice about taking benefits when you turn 62 — the earliest age at which you can claim them.
If you were born in 1960 or later, claiming at age 62 instead of waiting until you reach what the Social Security Administration considers your full retirement age (about 67) could mean receiving $300 less a month. On the other hand, waiting until as late as age 70 could mean an even bigger monthly check.
There are times when it does make sense to take your benefits early. Maybe you have no choice if you are too seriously ill to keep working, for example. Or, maybe you believe that you’re unlikely to live decades longer.
But think it through. If your parents lived a long time and you are likely to do so as well, starting to collect Social Security early — when the payment is smallest — means you could be scrimping for a long time.
For more, check out “2-Minute Money Manager: Should I Wait to Take Social Security?”