Misunderstandings about Social Security can cost you real money. Here are five misconceptions that could cost many people vital Social Security benefits.
1. You should claim your benefits at 65
Future retirees, on average, expect to claim Social Security benefits around age 65. A lot of retirees pick this age because it's when they become eligible for Medicare, or because they believe it's the "standard" retirement age. And 65 was previously the age when you could receive your "primary insurance amount" -- that is, the monthly retirement benefit you're entitled to receive when you reach your "full retirement age."
However, for those born after 1937, full retirement age is later than 65 -- and if you were born after 1960, you need to wait until age 67 to get your primary insurance amount.
If you claim benefits before your full retirement age, you'll lose a portion of your benefits for each month early that you claim. But if you wait past your full retirement age, you can actually boost your benefits for each month you delay them, up until age 70.