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Retirement & Estate

Retirement Planning 101: Should You Cash In Early or Wait on Social Security?

By July 13, 2023No Comments
retirement planning

Retirement planning is a significant part of aging and leads to a time when we can finally enjoy the fruits of our labor and pursue our passions. However, one crucial decision retirees face is whether to cash in on retirement savings early or wait for Social Security benefits. Let’s explore the pros and cons of both options, so as an independent insurance agent you can provide helpful insight to your clients and help them make informed decisions according to their financial goals and lifestyles.

Cashing In on Retirement Early:

Early retirement allows folks to leave the workforce and enjoy the freedom and flexibility that comes with it. Here are some advantages and considerations to keep in mind:

Pros of Cashing In on Retirement Early:

  • Freedom and Flexibility: Retiring early grants clients the opportunity to pursue personal interests, travel, spend time with loved ones, or even start a new venture.
  • Health and Energy: Early retirement often means clients will have more energy and better health to enjoy their newfound freedom.
  • Lifestyle Choices: If a client has specific retirement dreams, cashing in early may provide them with the necessary funds to fulfill them.

Things to Consider Before Cashing In on Retirement Early:

  • Financial Implications: Retiring early means relying on savings and investments for a more extended period. Ensure your client’s financial resources are adequate to cover living expenses throughout retirement.
  • Reduced Social Security Benefits: If a client chooses to claim Social Security before reaching full retirement age, their monthly benefits may be reduced, impacting their long-term financial stability.
  • Healthcare Costs: Retiring early may mean losing employer-sponsored health insurance, leading to potentially higher healthcare expenses until Medicare eligibility at age 65.

Waiting for Social Security:

Delaying retirement until you’re eligible for full Social Security benefits has its own set of advantages and considerations:

Pros of Waiting for Social Security:

  • Increased Social Security Benefits: For each year a client delays claiming Social Security beyond their full retirement age, their monthly benefits increase. Waiting can provide a higher income stream during retirement.
  • Medicare Eligibility: By waiting until age 65 to retire, clients become eligible for Medicare, which can significantly reduce healthcare costs.
  • Additional Savings and Investments: Continuing to work and delaying retirement allows clients to build more substantial savings, supporting their retirement nest egg.

Things to Consider Before Deciding to Wait for Social Security:

  • Lost Time and Opportunities: Waiting to retire means spending more years in the workforce, potentially missing out on the freedom and experiences that retirement offers.
  • Uncertainty: While waiting for Social Security, unexpected circumstances such as health issues or changes in the program’s regulations could impact a client’s eligibility or benefits.
  • Personal Considerations: Individual factors such as job satisfaction, physical ability, and family obligations might influence a client’s decision to wait for Social Security.

Retirement Planning and Your Goals

Deciding whether to cash in on retirement early or wait for Social Security is a complex choice that depends on various personal and financial factors. Consider your client’s financial preparedness, health, lifestyle aspirations, and the long-term implications of each option.

Ultimately, you should help guide your client’s decision-making to align with their goals, supporting them to secure and fulfill their retirement journey. Remember, retirement is a unique and personal milestone, and there is no one-size-fits-all approach. Evaluate the pros and cons carefully with your clients and help them to weigh their options to better pursue a satisfying retirement chapter in their lives.


As your North Carolina Medicare FMO, Carolina Senior Marketing is committed to serving you, the Independent Insurance Agent. If you’re not an agent with us, we’re still glad to meet a new face and answer any of your questions you may have. Please email us at info@carolinaseniormarketing.com to reach out.