While 89% of U.S. adults are at least “somewhat confident” in their Social Security knowledge, according to a recent survey from Nationwide, only 18% reported they felt “very confident” in their awareness.
That needs to change, according to one expert.
“Be proactive, take control of your future, and get this decision right,” Beau Henderson, founder and lead retirement planning specialist at RichLife Advisors, a metro Atlanta-based firm, told Yahoo Money. “For a lot of households, this is the most important decision to get right and retire."
He offered his top tips to take control of your financial planning and expand your knowledge about Social Security to help your retirement.
Start planning for Social Security 10 years out
When clients reach their 50s, that’s typically when Henderson said he is approached with retirement planning at the top of the agenda.
By giving clients the benefit of a 10-year window to make adjustments and forecast Social Security benefit amounts, he finds the transition to the golden years to be smoother and with fewer financial surprises.
Don’t make retirement decisions based on the decisions of others
Henderson explained that Social Security benefits are so individualized because every household has a different set of variables along with retirement goals, income, and expenses.
Despite everyone’s unique circumstances, he still hears from clients that their knowledge is rooted in the actions of “a neighbor, co-worker, or brother-in-law,” he said.
“If I ran optimization analyses for 20 households, there's not going to be any rules of thumb that apply across the board,” he said. “Just because somebody said you should do it at X age because they did that doesn’t mean it’s right for you.”
Be your own advocate
Rather than be intimidated by the over 500 potential ways to claim your Social Security benefits, Henderson wants to empower individuals to be able to make the most of the government program.
The Social Security Administration houses a wealth of knowledge about how to claim services, but its capabilities stop short of advising Americans on decision-making or alerting them of eligibility of additional benefits.
Henderson insists upon either self-education or meeting with a financial advisor in the years leading up to retirement to best build a strategy that’s right for you.
“I've never heard of Social Security calling somebody to share that there's $80,000 more in benefit they’re eligible for and then telling them how to claim it,” he said. “It's up to you to know what applies to you.”