Page 28 - Investment Advisor March 2021

Cover Story

Social Security

Strategies:

How Advisors Can Best Help Clients

Build Retirement Income

Claiming early can be tempting for clients, which means advisors

have to overcome their behavioral biases with analysis that

maximizes the value of this critical retirement income stream.

BY JASON FICHTNER AND MICHAEL FINKE

hen should individuals claim their Social Security income benefits?
According to a recent report by the Bipartisan Policy Center, more
W than one-third of Americans still claim at age 62 and two thirds
claim before their full retirement age (FRA).
Nearly a quarter of males claim at FRA, many without considering that by
doing so they are making an active choice to receive less income than they
could receive by claiming later. Others fail to consider the implications
claiming may have on their spouse’s benefits.
While many without adequate savings aren’t able to choose when to
claim if they retire involuntarily, everyone else has a choice. An analysis of
actual claiming decisions by retirees made by United Income Inc., a wealth
management software firm owned by Capital One, found that suboptimal
claiming decisions cost households an average of $68,000 in lost wealth.

26 INVESTMENT ADVISOR MARCH 2021 | ThinkAdvisor.com