Wait To Take: Options For Taking Social Security Later Could Save You Six Figures

Here's how to do it.

Financial planners continue to scratch their heads over the (bad) decisions people make when it comes to their retirement planning, even though there are so many ways to increase Social Security benefits.

We're living so much longer -- so the tens of thousands of dollars that the big mistakes cost you can really be a buzzkill on your overall retirement budget.

"The trend I'm seeing is that people are taking Social Security earlier and earlier because they have to for necessity," says Steve Ruckart, a financial planner and founder of Tennessee-based RAI Advisors. "But a lot of times people are taking it at 62 when in reality they would be better off drawing down other assets and delaying their Social Security for as long as possible."

If people wait until 70 to take their benefits instead of 62, they'll see an increase of 132 percent a month. Yet, many people don't look at other options for income in their 60s if they suddenly find themselves out of work.

"They're making a mistake," Ruckart says. "The typical family leaves about $100,000 to $120,000 in benefits on the table by taking it early as opposed to waiting and taking it at a later date. The people who are waiting are getting a whole lot more benefits."

Even those who have lost their jobs have other options before tapping into Social Security: Always look at your savings account or income from your 401(k) and IRAs well before you decide to take Social Security, he says.

The one option people might not think about for additional money is the spousal benefit, Ruckart says. That allows the spouse to draw half of the other spouse's Social Security benefit while allowing theirs to continue to grow until 70. Another doozy -- even if you're divorced, you may be able to tap your ex's benefits.

The fatal error many make? Relying on government employees, who typically offer only one or two options of taking benefits -- even though there are more than 200. Especially since Social Security is always changing the rules should you talk to a professional.

"My advice would be to talk to a financial advisor and see about the possibility of drawing from other sources in order to let their Social Security benefits grow, because they can't get that sort of guaranteed return in any other investment," Ruckart says. "They are hurting their family's long-term future by drawing that money out earlier."

What's baffling, Ruckart says, is how he comes across people "all the time" who have started drawing Social Security when they don't even need the money.

"They are just putting the money in the bank, and that's not really very smart," Ruckart says. "They're going to lose $100,000 or more in benefits over the course of their lifetime by doing it that way. You see people who have lots of money - several hundred thousand dollars stashed away and they're still drawing their Social Security benefits early because they don't understand what their options are."

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