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The Impact of Social Security in Retirement

  • Oppenheimer & Co. Inc.
  • January 13, 2021

When is a good time to start?

One of the most important decisions you must make as you approach retirement is when to start collecting Social Security benefits. Social Security is the main source of retirement income for many American workers. If you are among those who will receive Social Security, knowing when to start collecting benefits can have a major impact on what your monthly paycheck will be. The fact remains there is no one “best age” to begin taking your benefits, the timing you choose will be dependent on your unique situation and timeline. The following questions should be considered when determining the right time to claim your benefits:

How will the age when you start taking distributions affect your monthly benefit?

In a study conducted by United Income, results show that 96% of retirees do not choose the optimal age to claim Social Security benefits. While eligibility for Social Security begins as early as age 62, those taking their benefits this early will receive 30% less than they would if they waited until full retirement age; currently 66. Conversely, by delaying taking Social Security beyond full retirement age, your monthly income can increase by 8% per year until age 70.

What other income sources will you have in retirement?

While Social Security is a large component of your retirement income, it is not the only source. The ability to draw income from other avenues such as personal savings, pensions, or annuities can affect your claiming strategy. Each of these investments can help bridge the income gap between early retirement and full retirement age, or can even provide income long enough to take advantage of delayed retirement credits.

Do you have longevity in your family?

In some cases individuals with a history of longevity in their families can expect their retirement to last 20-30 years. The average male age 65 has a 50% chance of living to age 86 and a 25% chance of living to age 93. While the average female age 65 has a 50% chance of living to age 89 and a 25% chance of living to age 96. As you transition from the accumulation stage to the distribution stage, it is imperative to evaluate whether your nest egg is sufficient to maintain your lifestyle through retirement.

What is your marital status?

With increasing life expectancies, once you and your spouse turn 65, there is a 25% chance that one of you will live well into your 90s. In order to make the most beneficial claiming decision, married couples must factor in spousal and survivor benefits.

Today people are living longer than they were 30 years ago, and with healthcare costs consistently increasing, one of the biggest concerns in retirement is running out of money. Whether you decide to collect Social Security at age 62 or delay until age 70, an annuity can help supplement that benefit. Using a portion of your retirement portfolio to create a lifetime stream of income by purchasing an annuity can help take some of the unpredictability out of your future retirement.

Contact an Oppenheimer Financial Professional to discuss how an annuity can compliment your retirement portfolio.

Sources & Disclosure


Brighthouse Financial. (2018, April 18). When Should You Plan to Collect Social Security? Retrieved from

Fidelity. (2019, July 29). Social Security tips for couples. Retrieved from

Rae, D. (2020, January 23). When Is The Best Time To Claim Social Security Benefits? Retrieved from Forbes:

Sheedy, R. L. (2013, August). Mind the Gap If You Delay Social Security. Retrieved from Kiplinger:

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