Should I Collect Social Security Early and Invest it?

When you go to collect Social security, you want to make sure you’re selecting the option to open the most amount of dollars in your pocket over the course of your retirement. Some people think it’s best to take social security at 62 while others believe it’s better to delay social security and collect a larger benefit. In today’s video, we are going to talk about what is the best age to file for social security retirement benefits and what are the pros and cons of taking social security early versus delaying it.

Learn the tips & strategies to create your secure retirement.

⏰ TIMESTAMPS
00:00 - Introduction to Social Security
1:25 - Benefit Options
3:20 - Who Comes Out Ahead?
6:35 - Investing Wins? It Depends!
9:02 - What If You Collect Early And Don't Invest?
11:37 - Benefits of Delaying SS
13:54 - Consider Your SPOUSE!
15:19 - 7 Reasons To Delay Social Security

_ _

For more resources and content, check us out below!

Other videos we think you'll like:

[Medmann]

So if I start collecting SS at 62 the break even if I would have started at 67 is Age 78, how many of us are going to live past 78? How much longer than 78 will we live? You need to retire as soon as you can afford it. My dad is 84 & his day is mostly just watch TV & reading books, he can't walk more than a few steps & is in a nursing home. The actual amount of your retirement when you can actually "Do" stuff may be shorter than you think. We need to look at functional life span versus just actual lifespan.

[janesmith]

3/18/24: Here’s how to watch James’s videos: (1) Get out your retirement spreadsheets, notes, worksheets. (2) Watch one of James’s videos while taking notes on new perspectives and ideas (or watch while you are on the elliptical and take notes later). (3) Revise spreadsheets, notes, worksheets. (4) IF MARRIED, casually mention only most salient point from video to spouse and explain (if they let you) until their eyes glaze over. 5) Watch another one of James’s videos. (6) Repeat steps (3), (4), and (5) until you have watched them all. (5) Force your spouse to watch (with you, of course) the three videos that cover the topics that your spouse understands the least. Hopefully James will continue making these great videos for people like me. Thanks James!

[msills]

This actually was the best articulated, most succinct discussion on social security that I've seen and heard. Congratulations on that!

[Davek]

Retiring at 58 and collecting at 62.... for this exact reason. It takes so many years to break even, while giving up 5 years of enjoying retirement. This is an easy decision!

[jeffreyhare]

Had read about the benefits of going out @ 62 and this Army retiree already made up his mind. 20 years in the Army, 20 years in a PICU, and had worked in some capacity since age 10! (Also could not see myself rolling ventilators around, taking critically ill kids to scan after scan @ 65) So paid the mortgage off 27 years early as my retirement gift and enjoying four + years of retirement!!

[pensacola]

I personally think people suffer this decision to much. Make your decision, and enjoy your There is only so much in your life time wealth bucket.... Nice analysis....

[davisholman]

My dad and my brother both passed at age 63, from different reasons. Sorry, but take the SS. Like the investing idea. And btw, ‘working’ a little part time - keeps you active & is FUN.

One thing that was not discussed here but actually can have a big impact on the SS collected is the healthcare cost between 62 and 65. Medicare doesn’t start until you turn 65. You would be spending your early collected SS on health insurance since most of the people get their health insurance through their employers. I think retiring and collecting at 65 is the best of both worlds.

[Dr.TJ]

This is a very well done video. But there are two additional benefits to taking it early. If you're single and have children and you die before 70, your children get nothing. So take it early and build your estate to pass on to your children. The other benefit to taking it early is to have play money for nicer vacations, dining out, toys, etc. If the break even point is 81, think about what you'll be doing at 81 and would the little bit extra you might get at that point mean anything compared to the fun you could have had in your 60s.

[steelcastle]

This is a good basic boiler-plate comparison of SS early versus late options.
It gets more complicated when individual situations and personal considerations each person has and what they consider priority quality of life issues are added in.
That's why these videos are useful (extremely), but they are only a starting point (versus "the answer") for individual/personal decisions on when to take the money and run (or walk)!

[suespony]

Some great information, I think I am going to retire at 62, which is May of 2022 for me. Biggest reason is I still want to do things while I have the energy to do such. If I live past my break even age of 78, so be it, at that point probably won't have the drive and energy to do much anyway.

[kevinmccarty]

I really appreciate your knack for covering the many sides of an issue clearly, breaking it down in a readily understandable points, without dumbing it down or oversimplifying. Good stuff.

[richb]

1). Get out of debt.
I know its easier said than done but you cannot go into retirement in debt.
If you cannot get out of debt before retirement try this test.
Find out your actual ss benefit minus taxes and compare that to your budget.Don’t forget to add medical into that number.
If your SS covers your budget and you can continue to work then start collecting ss and use all of your working money to pay off debt.
If your ss does not cover because your in debt and cannot work then you are like me and most other people. I wish I had gotten out of debt before retiring.

[michaelknowsstocks]

62 is my goal. Not guaranteed to live til 80, 90, etc. Get it while you can and spend wisely!

[CycleGirl-]

Great video! I've seen too many advisors oversimplify the analysis and advise that you're better off waiting to get a larger monthly check. One additional risk around the decision to delay is that the government could change the rules. By the mid 2030s we know SS will have a shortfall. Something will have to give at that point. If the government has to curtail anyone's SS check, it won't be the people getting the smallest checks - it will be the people getting the largest checks. I think that you're much better off taking the money from age 62 to 70 and investing it. Alternatively, you're trusting the government with it.

[JaniceHylton]

I'm retiring at 55.
Taking my SS at 62.
My husband is retiring at 67/70 and then collect.
Soon as I can get my SS, I WANT IT!!

[aikirunner]

Another benefit of delaying is drawing down your qualified plans between 62 and 70 means you’ll have lower RMD at at 72. Also the choice of delay gives you more agility to change your mind. You can always change your mind and take it early.

[edwinhermanson]

A lot of ifs ! I am going to wait until as close as I can to my full retirement at 66.6 yrs old. My 401 is still growing, my SS is still growing, and I'm still collecting my FULL paycheck.

[roblovestar]

Good exploration of the topic James! One thing that might make your comparison more 'apples-to-apples' is to include the SS Cost of living adjustments. Those are adding up even before you begin collecting.

[BarryJSilva]

Every year I wait to collect the monthly payment goes up 8% with today's (2022) cost of living currently at 5.9%, I'm waiting because I cannot get an investment that will guarantee me 13.9% annually. If I collect early, I will loose the 8%. I like the 8%. I'm healthy, love my job, make good money and my dad lived until 93. I'm waiting till I'm 70 years old and will start collecting in 2024. It's right around the corner.