Practical Applications of Should a Retiree File for Social Security at 62 or 70?

Practical Applications Summary

In Should a Retiree File for Social Security at 62 or 70? from the Fall 2019 issue of The Journal of Retirement, author Michael Harris (at Indiana University Southeast School of Business) challenges the popular belief that all retirees should delay filing for Social Security until age 70 to maximize their monthly income. This way of thinking treats retirees as a homogenous group with one goal: wealth maximization. But retirees are a diverse group with different goals based on their individual circumstances. Those who have little or no retirement savings and need maximum Social Security income or those who want to work as long as possible may wish to file later. Others may be better off filing earlier so they can pursue a wealth optimization strategy—making the best use of Social Security, pensions, savings, and part-time employment—to support the retirement lifestyle they want.

The author analyzes different retirement scenarios to help people with different goals understand the costs and benefits of filing at age 62 or age 70. He then encourages financial advisors to work with their clients to pinpoint the Social Security filing strategy that will work best for them.