Social Security Strategies: Lee Ann Torrans

Social Security benefits may be claimed as early as the beneficiary reaches 66.   To draw at 66 rather than at age 66 means the benefits will be reduced by an amount of 32%.  The decision to initiate your Social Security income stream at the earlier age means you may elect to place the income into an irrevocable life-insurance trust.   This trust could be dedicated to charitable gifts, an asset to designated heirs or a fund to help heirs with estate taxes on the underlying estate.

Social Security benefits are calculated using a formula called the primary insurance amount.  Benefits can be claimed at age 62.  Full retirement age is 66 in order to receive 100 percent of your primary insurance amount.  However, every 12 months that you delay receiving your benefits an addtional eight percent is added to your income until age 70.  Additionally, there is a cost of living adjustment added to your benefits.

Men who reach age 65 can be expected to live to an average age of 86.6, and women to 88.8.