I have clients asking me regularly if they should start taking their Social Security at 62, 66 or 70. So, I look into my crystal ball (yes, I have one just for this) and then ask them how long they are going to live.
The longevity issue is the crux of the issue. To get the most out of the system, it helps to have all of the variables. We don’t have all of the variables. We talk about family longevity, but our lifestyles are vastly different from our parents in their day. We have more stress; things move quicker, and prices rise even faster. While we do not smoke or drink as much as our parents.
So, we move to the calculation phase of the analysis. We look up the estimated payouts for each age. Then we start comparing the break-even points. What age are you when the 66 starts to exceed the 62 payouts, then what age are you when the 70 payouts exceed the 66.
Then we look at the other monies that they have, do they have enough to get to 70 without changing their lifestyle, how about 66? This, more than the longevity issue, are usually the deciding point for most.
We are not good savers, most of us have little in savings and sometimes less in retirement savings.