Study: More Americans delaying Social Security

Message that benefits grow if you wait past 62 seems to be sinking in.

Older Americans are getting smarter about Social Securit y s t r a t e g i e s , i f t he re s ul t s of a recently released Fidelity study are any indication: More people now realize it pays to wait to claim benefits.

When the study was last conducted, during the 2008 financial crisis, nearly half of 61-yearolds at the edge of eligibility were eager to collect their checks as soon as they turned 62.

According to the new Fidelity Investments Social Security IQ survey, though, only 28 percent of those age 61 plan to claim benefits as early as possible, a significant decline from 2008, when 45 percent of those surveyed were planning to start collecting immediately.

Why are they waiting? A better economy helped. Nine years a go, more t han hal f ( 5 3 percent) of 61-year-old respondents described themselves as unemployed. Today, the number of 61-year-olds describing themselves as unemployed dropped to 41 percent.

Twice as many pre-retirees (21 percent now, 10 percent in 2008) believed that delaying benefits offered a better return than simply claiming them as soon as possible and investing the money.

However, the survey — conducted online in October among a sample of 521 respondents ages 55-61 who were not on permanent disability — showed that many still don’t understand how Social Security rules have changed:

■ Nearly 4 in 10 pre-retirees thought it was possible to alter their Social Securit y claiming strategies in retirement — but once you opt in, you can’t make a change.

■ The majority did not realize that the Social Security Administration needs three months’ notice before issuing the first check.

■ Only a quarter knew their full retirement age, or FRA — essential information to figure out how to maximize benefits.

The longer you delay claiming Social Security, the bigger your benefits could be, explained Ken Hevert, senior vice president of retirement at Fidelity Investments.

“We were encouraged that more people seem to be making this decision more thoughtfully than in years past,” he said.

Though 62 is the earliest age some can claim benefits, it doesn’t necessarily mean that’s when you should start.

Benefits are based on the full retirement age, which is determined by the Social Securit y Administration and calculated assuming you will claim at FRA, according to the year you were born.

For those born in 1960 or later, the full retirement age is 67. For those born before 1960, the full retirement age is 66. Waiting until full retirement age means your monthly Social Security income could increase by as much as 30 percent.

The whole idea of retirement is starting to change as Americans live longer and face more years in it.