2. Decide when to tap Social Security
Timing is everything when it comes to drawing Social Security benefits, so if you know that’s going to be a part of your retirement income you need to figure out when you’re going to apply. Full retirement age is 66 as of 2015 but you can start drawing benefits as early as 62. The trade-off is that the sooner you start receiving payments, the less money you’ll qualify for.
For example, if you take Social Security at age 62, you’ll only get 75% of your monthly benefits. That amount goes up to 93% if you wait until age 65. If you can wait longer to start taking payments, you’ll actually get more money. Holding out until age 70, on the other hand, would cause your benefits to increase by 8%. If you’re married, you also want to think about staggering your benefits to make sure you’re drawing the most income possible.