In the United States, the Social Security is a federal government program, administered by the Social Security Administration (SSA), which provides financial protection to workers and functions as a contribution system during working life to guarantee income in the old agein case of disability or death.
As stated by the Social Security Administration, the system distributes financial aid through different regulated programs, although the most popular is the retirementwhich consists of monthly pensions for retired workers. Given this situation, the age The current full retirement age in the US is in the 67 years old.
However, in the United States, retirement can be claimed early, with a reduced amount, starting from 62 years. Likewise, Social Security provides financial support to people with serious medical conditions that prevent them from working and to dependents of a deceased worker, such as widowers or minors.
Despite this, during an interview with the digital newspaper Infobaethe financial advisor Suze Orman warned that collecting Social Security in the United States among 63 and 66 yearsfearing a possible cut, may leave retirees with a permanent reduction in its benefits, since that decision is irreversible before the SSA.
Permanent penalty for retirees
According to the American network Fox Business NetworkInsurance Old Age and Survival (OASIfor its acronym in English), the pension program of the social security system that guarantees a basic income to retirees, could exhaust its accumulated reserves in December of the 2032in just over six years.
Therefore, once the accumulated reserves of the OASI have been consumed, current tax revenues would be enough to cover only the 78% of scheduled retirement benefits. Consequently, the worry for the long term solvency of the system encouraged more people to apply for the benefit before meeting the 67 years old.
Collecting Social Security before turning age 67 reduces the benefit by 70% of the full benefit, because at that age one accesses the 100% of the accumulated benefit. Therefore, if a person starts collecting earlier, he or she receives only a percentage of that sum, and the reduction is fixed in a fixed manner. permanentbecause it is irreversible.
“Claiming early is basically equivalent to accepting a penalty of 30%. The data matters because, according to figures from the Social Security Administration, starting collection before the 67 years is still a frequent option among retirees,” added Orman, a financial expert who analyzes the economic situation in the United States.
life expectancy
In accordance with the Univision network, the decision to claim Social Security early is linked to life expectancy, since a woman with an average state of health that reaches 65 years has a life expectancy of 85 yearswhich implies a high probability of continuing and facing expenses during retirement.
“If you reach the break-even age of 79, there is a very real possibility that you have at least another decade ahead of you. Every month after that break-even point, the person who waited is earning significantly more,” concluded financial advisor Suze Orman, who seeks to provide support strategic for decision making.