Social Security Mistakes to Avoid

If you’re an avid watcher of the show, you probably remember when Art Canfield in a few episodes back, mentioned that there are over 9K different options when applying for Social Security as a married couple. Now with that, so many options, there often comes some very big mistakes. So what I would like to cover today is seven common mistakes that you want to avoid when thinking about and applying for Social Security. So the first one and this is the biggest one that’s out there, the most common, is not asking for help. I mean I just said 9K different options. How do you pick which one is right for you, okay? Ask for help. Don’t be afraid to reach out. I mean here at Centennial Wealth we have an awesome program where we can crunch those numbers. We can look at, you know all your different income sources and determine okay, what makes the most sense for your situation? Mistake number two, not accounting for longevity. So you know oftentimes I hear people, I’m going to take Social Security right when I can at age 62 and they don’t think about okay, what about the next, you know 15, 20, 30 years of their life? I mean do you have longevity on your side? Do you have those great genes where hey, maybe your parents are pushing 90 or pushing 100, okay? What are the odds that you are going live a long, long life? And if the odds are good, well then maybe you want to account for longevity. Maybe it makes the most sense to push your start date for Social Security back a little bit. Mistake number three, not thinking about spousal benefits. This is a big one for married couples. I mean typically you’re going to have a higher earner that’s going to get a higher benefit on Social Security when they apply for it. And then a lower earner, right? So in most cases, in a married couple situation if you want to protect that surviving spouse, you want to delay the higher of the two benefits for as long as possible. And really this is because okay, well the odds of both of you living a long life statistically, probably not as high, right? One of you most likely will predecease the other. Well when that happens, the surviving spouse, they get the higher of the two Social Security benefits, okay? So that’s something you definitely want to plan for. Mistake number four, not looking at the big picture, okay? When I say that, the Social Security decision, yeah, that’s one decision. But retirement in general, that’s the big picture, okay? So how does Social Security if you started that now, how does that affect your tax situation? How does that affect your health insurance situation, okay? Retirement planning is a 1000 piece puzzle. You want to make sure that all of the pieces of the puzzle work together to accomplish whatever your retirement dreams are. Mistake number five, ignoring statements, okay? I know right now the Social Security Administration doesn’t send out those statements like they used to in paper form. But it’s all transitioned to online. So you have online access. You can go set up your online account and you know take a look at, okay here are my benefits at age 62 versus 65 and full retirement age and so forth. Don’t ignore that. Make sure you get that set up so you can start thinking about a plan and get a plan in place for when to pull the trigger on Social Security. Mistake number six, not accounting for COLA or cost of living adjustment. So with Social Security, the average cost of living adjustment or annual increase on your Social Security benefit is 2.6% over the last 10 years. That’s you know, if we look at that 15, 20 years from now, that’s going to increase your benefit quite a bit, right? So that’s something you want to pay attention to and understand how that affects your overall retirement plan. And then finally mistake number seven, not planning early enough for Social Security. So here at Centennial, we recommend that you start thinking about Social Security very seriously in your 50s, okay? Make sure like Is said to set up that online access. Get an idea on okay, what are my benefits going to look like and maybe talk about different ways that you can maximize your benefits whether it’s earning more income or delaying that benefit even farther. So there you have it. Seven different mistakes that you want to avoid when applying for Social Security. Remember, 9K different options if you’re a married couple. Don’t go it alone. Give us a call here at Centennial Wealth Advisory. We’d be happy to help, not just your Social Security planning, but retirement planning in general.