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An AI Article on taking Social Security Benefits
We hear so much about the dangers of AI and what it might mean for the future of certain jobs. I thought I’d give AI an opportunity to help me write this quarter’s benefit newsletter. I posed the following question to Google’s Bard AI, “Write me an article about the pros and cons of taking social security benefits early.” This is what Bard AI came back with.
When contemplating retirement, one of the biggest decisions involves claiming Social Security benefits. While claiming early seems alluring for immediate financial relief, the long-term impact can be significant. Here is a deep dive into the pros and cons of claiming Social Security at 62 (the earliest age) versus waiting until full retirement age (FRA, which ranges from 66 to 67 for most) or even beyond.
Taking the Early Bird Discount: Pros:
Immediate Income: Early benefits provide a guaranteed income stream, helpful for those with limited retirement savings or facing financial pressure.
Freedom and Flexibility: Claiming early opens the door to earlier retirement, pursuing passions, or bridging the gap between careers.
Spousal Benefits: Certain spouses may access higher survivor benefits if their partner claims early.
Cons:
Reduced Payouts: Early claimants suffer a permanent 6.7% reduction for each year prior to FRA,
amounting to a 25% cut at 62 compared to FRA. This reduction compounds over time, impacting lifetime income significantly.