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Social Security Questions
By Gary Case

Published in the Idaho Press Tribune Jan 2011

Social Security retirement benefits have been touted as an integral part of the three-legged stool that provides our retirement income. The other two legs are personal savings and retirement/pension plans. While many questions regarding Social Security benefits are personal, some questions can be addressed in a general nature. In addition to thoughts here and my next column, our office has asked a public relations speaker to present a workshop on Social Security benefit on Tuesday, January 25th at 6:30pm in the Marriott Courtyard Suites at the corner of Overland and S. Eagle Road. Please contact our office for additional details.

One of the most common questions we receive regarding Social Security Retirement Benefits is, “When should I start collecting, age 62 or later?” The answer, as you might have guessed is, “It depends.” Many factors play into the decision to begin receiving benefits, including; your marital status, your general health and life expectancy, whether you collect your own benefit or income based on a spouse’s benefit, if you plan to continue working and your other sources of income.




People often mention a “break-even point,” which is the point in time that the sum of benefits taken early falls short of benefits begun at a later date. A common thought is, “I’d have to live past age 78 to get more Social Security income from waiting until my full retirement age as opposed to collecting my benefit at age 62.” While mathematically correct, this concept overlooks surviving spouse benefits and potential cost of living increases based on the higher initial payment available at full retirement.

In some cases, someone who will eventually receive a higher income later based on their spouse’s may wish to begin receiving their own benefit at age 62, switching to their spousal benefit when their spouse begins to collect, hopefully at a point closer to full retirement age.

There is currently a “do-over” provision if you decide that you took your benefits too early and you want to receive the higher amount collectible if you start at a later date. This option is available to those who pay back all the benefits that you and your family have received, plus any money withheld for Medicare Parts B, C, and D; also any tax withheld. This could add up to a considerable sum; however, the benefits gained could exceed the amount you might receive by using an identical sum to purchase an immediate annuity from an insurance company. More to come in my next column.


Securities offered through Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Investment Advisor Representative, Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Cambridge and Cornerstone Financial Planning are not affiliated.