Full Article Link: https://www.foxbusiness.com/lifestyle/americans-rethink-social-security-timing-longer-lifespans-insolvency-fears-raise-stakes
Quote from Evan Mills
“Social Security certainly has a funding problem. If you claim now, you’re basically making a bet that Congress does nothing about the underfunding problem.”
— Evan Mills, Associate Financial Advisor at Scholar Advising
Key Takeaways
The Social Security decision is becoming more complicated.
With concerns about long-term funding, inflation, and increasing life expectancy, more Americans are questioning whether they should claim benefits early or wait for larger monthly payments later.
Claiming early and delaying both involve risk.
As Evan Mills explains, claiming benefits early assumes Congress will not meaningfully address Social Security’s funding issues. But delaying also carries risk, particularly if health or longevity expectations change unexpectedly.
Longevity has changed retirement planning.
Retirement is no longer a short phase of life for many Americans. Longer lifespans mean retirees may need income strategies designed to last 25 to 30 years or more.
Taxes can create unintended consequences.
Experts cited in the article warn that combining Social Security with retirement account withdrawals can trigger higher-than-expected taxes, sometimes referred to as the “tax torpedo.”
Flexibility matters more than certainty.
With so many moving parts, from healthcare costs to housing expenses to future policy changes, retirees may need to remain adaptable with spending, housing, and work decisions throughout retirement.