4. Try to benefit from Social Security as late as possible
People become eligible to receive Social Security benefits when they turn 62. And if you want to live on Social Security alone, we advise you to wait to apply for it as soon as you are eligible.
We say this because if you want to maximize your benefits and receive more each month, it is better to delay. If you apply for benefits at age 62, your monthly payments might be cut by up to a third. However, if you decide to wait and claim it after your full retirement age, you will get a boost until you are 70 years old. This boost is an increment of 8% in benefits.
Another benefit of delaying your Social Security is that your COLA increases will also be larger. Every year, the Social Security Administration publishes the cost-of-living adjustment (COLA) for each and every active plan beneficiary. Although all recipients will see a rise in percentage, the actual sum of money you will receive is based on the benefit.
So, if you plan to live on Social Security alone, it is better to delay it as much as you can. In the end, you will be the one who receives more money.
