AARP today announced the launch of its Social Security Benefits Calculator, a unique interactive tool designed to help people make the complex but critical decision of what is the best age to claim Social Security benefits to meet their financial goals. The calculator is part of AARP’s new “Ready for Retirement?” effort, a ten-step approach to envisioning and planning for a secure retirement, which includes creating a budget and preparing for the unexpected. To try out the new AARP Social Security Benefits Calculator, visit www.aarp.org/socialsecuritybenefits.
“Our research shows that many Boomers are worried about retirement because they don’t feel prepared,” said Jean Setzfand, Vice President of Financial Security at AARP. “With our new easy-to-use calculator and our ‘Ready for Retirement?’ resources, we want to help older Americans understand retirement as a life transition, visualize their goals, and take the steps needed to build retirement security.”
Often, one of the most important retirement-related decisions is when to claim Social Security benefits. The only guaranteed, lifelong source of retirement income for most Americans, Social Security is the principal source of family income for nearly half of older Americans.
More than half of those claiming retired worker benefits in 2009 elected to receive benefits as soon as they became eligible at age 62. But that decision comes at a cost of lower monthly benefits, potentially decreasing one’s lifetime retirement income by a significant amount – as much as 8 percent lower for every year that someone claims before reaching full eligibility age.
“Choosing to claim benefits early – or late – is a highly personal decision made all the more difficult by the weak economy,” said Setzfand. “With health, employment, lifestyle and savings among the many variables to consider, no one age is right for everyone. However, the later you decide to claim, the greater the potential benefits may be for you and for your family. Our calculator helps people weigh the variables and make an informed decision for their individual circumstances.”
The AARP Social Security Benefits Calculator walks users through a simple, question-and-answer format and provides estimates for both monthly and lifetime benefits across a range of ages. It also allows users to customize their experience by calculating spousal benefits and taking into account the impact of continuing to work while collecting benefits. It gives users the opportunity to compare estimated monthly benefits to expected expenses in retirement, and to print a personalized summary report.
In addition to the calculator, the “Ready for Retirement?” ten-step guidelines incorporate evaluating your health, building your social network, and finding new ways to cut expenses.
“Too many people avoid planning for retirement because they think it’s just a numbers game, or they simply don’t know where to start,” concluded Setzfand. “More and more in today’s environment, though, individuals really have to take responsibility for ensuring their own retirement security. With these tips and tools, AARP is here to help.”