The Time To Draw Social Security Benefits Is Different For Everyone

Maura Schauss |

By Todd Youngdahl, CFP®

You may have heard your friends talking about it. Or maybe you’ve seen it in the news. When it comes to deciding when to start drawing from Social Security, all you have to do is type in your information to a Social Security maximization software, and voila! It tells you exactly what you need to do to maximize your benefits.

Making a decision that will give you the best Social Security payout plays an essential role in an effective retirement plan. The longer you wait, the higher your monthly payout will be (up to 30% more). (1) And a higher monthly payout means less pressure to generate income from other investments.

But how well do these calculators actually work? Well, it turns out, these calculators are unable to accurately consider the entirety of your unique situation. So, it’s important to consider how your personal circumstances may affect the ideal date for you to start drawing from Social Security. Here are three of the most important things you need to factor into your decision.

Your Income Needs

How much will you need to live each month when you retire? How are your expenses likely to change as time goes on? Do you have any dependents? Any debts? What other income will you have besides Social Security? Questions like these are important to consider when deciding the right time to start drawing on Social Security. For example, if you think you’ll be able to meet your needs with other sources of income, there’s no reason to start drawing on Social Security early.

Current Market Conditions

However, there actually is a reason you might want to start pulling out your Social Security even if your income needs are met, and that is to invest it. If the market conditions are such that your estimated investment returns are greater than the increased benefits you’d receive if you were to wait, it might be a good idea to start drawing early. Keep in mind, the gains you may make by investing the money are uncertain, while the extra benefits of waiting to draw from Social Security are guaranteed.

Your Family Life Expectancy

It's not wise to make your Social Security decision based solely on your current health. You may think that if you have good health, your best option is to wait. But that’s not always the case. It’s important to factor in your family history and life expectancy as well.

For example, one of my clients decided to start drawing from Social Security at age 62 despite being in perfect health. She did this because she knew her family life expectancy was less than 80. Sadly, she passed away three years later. However, if she hadn’t started drawing early, she never would have benefited from paying into the system her whole life.

On the other hand, it’s also important to plan for extra years beyond your life expectancy. Laurence Kotlikoff, a professor of economics at Boston University and president of Economic Security Planning, says, “You can’t play the odds when it comes to how long you’re going to live, because there’s no guarantee you’re going to die on time.” (2)

Next Steps

Although these three factors are important, they aren’t the only ones to consider. The bottom line is, there are many variables to consider, everyone’s situation is unique, and Social Security maximization software can’t take everything into account. Because of this, it’s important to only use it as a rough guide. In order to develop a plan personalized to your unique needs, your best option is to meet with a financial advisor who specializes in Social Security benefits. If you’d like our expert help in creating a plan to ensure you maximize your Social Security benefits, call our office at 703.584.2700, email us at or schedule a meeting with Todd.

About Washington Wealth Advisors

Washington Wealth Advisors is an independent registered investment advisory firm serving high net worth families and small businesses. We focus on holistic financial planning and comprehensive investment management. Leveraging our core strengths of unbiased, active investment management together with a detailed annual financial planning capability, we serve your comprehensive investment and financial planning needs.