When to take Social Security is a deeply personal decision. For someone who is 63, newly diagnosed with lymphoma, and intends to keep working while investing the benefits, the choice involves balancing health outlook, income needs, taxes, and long-term goals. If you plan to take Social Security next year, consider how each factor fits your situation before you take Social Security.
When to take Social Security
Starting benefits early provides immediate cash flow and the option to invest the money while you continue earning a paycheck. However, claiming before full retirement age permanently reduces monthly benefits. Waiting increases your monthly payment, which can help if you expect to need higher guaranteed income later.
Health and life expectancy
A serious diagnosis can change the calculus. If your health outlook suggests a shorter time horizon, claiming sooner may make sense. If your care team expects a good response to treatment and a long horizon, delaying could still be worthwhile for the higher monthly amount.
Earnings and the earnings test
If you claim before full retirement age while still working, the Social Security earnings test may withhold part of your benefits if your wages exceed the annual limit. Withheld benefits are not lost. They are used to adjust your benefit upward at full retirement age.
If your income is modest, this may be less of an issue. If you have high earnings, the withholdings could be significant.
Investing the benefit
Investing your Social Security checks can work if you have a disciplined plan and a suitable risk level. Compare the potential after-tax returns to the effective “increase” you receive by delaying benefits.
Delaying between full retirement age and 70 raises your benefit each year, which is a risk-free increase backed by the government. Market returns are uncertain, so weigh risk and time horizon carefully.
Taxes on benefits
Your benefits may be taxable if you are working and your combined income exceeds IRS thresholds. This can reduce the advantage of claiming early with the intent to invest.
Coordinate benefit timing with tax planning, including retirement account distributions, to manage your total tax bill.
Spousal and survivor considerations
If you have a spouse, your claiming choice can affect survivor benefits. A higher earner who delays can increase the survivor benefit for a spouse, which may be valuable if one partner is likely to outlive the other.
Cash flow and insurance costs
Factor in ongoing medical expenses, premiums, and out-of-pocket costs related to lymphoma care. Reliable monthly income may provide stability during treatment.
An emergency fund can reduce pressure to claim early.
Local perspective for Hawaiʻi retirees
Hawaiʻi has a high cost of living. Healthcare access may involve interisland travel or specialty care on Oʻahu. These realities can tilt decisions toward ensuring dependable income for medical and housing needs, or toward delaying if your budget is stable.
How to decide
- Run claiming scenarios at 64, full retirement age, and 70, including taxes and the earnings test.
- Ask your oncology team about a realistic health outlook to inform your time horizon.
- Compare the guaranteed increase from delaying to the expected after-tax returns from investing.
- Coordinate with a fiduciary planner and a tax professional to align benefits, investments, and healthcare costs.
Bottom line, there is no single right answer. If near-term income and flexibility matter most, claiming sooner can fit your plan.
If longevity protection and a larger guaranteed check are priorities, delaying benefits may be better. Revisit the decision annually as your health and work situation evolve.
For broader context on program finances and policy changes, some retirees also follow news about Social Security insolvency and potential tax reforms.
To understand how your specific benefits will be calculated and affected by different choices, you can review your statement and tools on the official Social Security Administration website.
Hawaiʻi residents evaluating retirement timelines and healthcare costs can also find eligibility rules and benefit information through the state’s Department of Human Services.
