Lots of recent retirees are wishing now that they’d waited to claim Social Security till they were older, because health care costs are eating up their benefits.
That’s according to the third annual Nationwide Retirement Study, which found that 23 percent said they’d wait till they were older to claim benefits, if they could do it over.
Among recent retirees — those retired 10 years or less — who wouldn’t change their claiming date, 39 percent said it was because they had to retire, thanks to a life event that forced their hand.
More than a third of current retirees (37 percent) point to health problems as the villain in their retirement picture, with health problems keeping them from living the retirement they expected. And 80 percent of recent retirees say those health problems came earlier than expected. Health care expenses, specifically, keep one in four current retirees from living the retirement they expected.
One problem faced by potential retirees is that they don’t know how much of a benefit to expect from Social Security once they do start drawing checks.
Future retirees say they expect to get $1,610 in monthly Social Security benefits. Recent retirees report their actual monthly benefit is about $1,378, while those who have been retired longer reported receiving just an average of $1,185 per month.
Most have no idea how to predict the amount of money they’re entitled to. Since 86 percent of future retirees cannot correctly identify the factors that determine the amount of Social they’ll receive; as a result, not only do they not know how to accurately determine their benefit amount, they can’t figure out how to maximize the Social Security benefit they’ve worked all their lives for.
While the cost of living and inflation are the two top reasons expenses increase in retirement, recent retirees are less likely to say that their living expenses will decrease, or did decrease, in retirement.
And while the top reason retirees say life is better in retirement is that they’re not working any more, those who say life is worse in retirement say so because of the drop in income.
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