You probably know that you can begin drawing your Social Security income at age 62. But many people don’t understand that deferring Social Security income will cause it to grow by as much as 8% a year until age 70.
Look at this example to see how this works. Imagine you are retiring this year at age 62. The full age of retirement for you currently is 66, now suppose at age 66 your full Social Security income benefit would be $3000 a month.
If you choose to begin receiving your Social Security income at 62 your income for life will be $2100 per month or 70% of what you’re eligible for. If you can wait until your full retirement age you’ll collect the full $3000 for the remainder of your life but if you can hold out just four more years until age 70 your income will jump 8% annually to a total of $3779 a month. By waiting until age 70 the income you receive is 79% higher than if you begin drawing at age 62.
Investments that guarantee an 8% growth rate on income per year are nearly impossible to find and yet only 3% of all Americans are deferring Social Security benefits to the age of 70. Of course this is not surprising, most people don’t want to work until age 70 even if they have the physical ability to do so. Usually this means they choose to draw Social Security early at age 62.
Fortunately there is another option. With a HECM Reverse Mortgage a retiree can eliminate their mortgage payment, pay off other debts and access the equity in their home through a line of credit to supplement their income needs until the higher Social Security benefit kicks in.
If you or someone you love needs help with retirement income, call me today so we can review the options of a HECM Reverse Mortgage.
HECM Reverse Mortgage Specialist
Heritage Reverse Mortgage
NMLS # 267962 Company NMLS # 1497455