One of the Most Important Retirement Timing Decisions for P&G Retirees
Every year, we hear the same question from clients preparing to retire from P&G:
“When should I turn on Social Security?”
It’s a great question because the decision can impact
hundreds of thousands of dollars over a lifetime.
Yet many people approach it with simple rules like:
- “Take it at 62.”
- “Always wait until 70.”
- “Take it when you retire.”
The reality is that
there is no universal answer. The right timing depends on your goals, your portfolio, and your retirement plan.
Let’s walk through the key considerations.
The Four Ages That Matter
Social Security offers several possible starting points.
Age 62 — Earliest eligibility
You can start collecting benefits at
62, but doing so permanently reduces your benefit.
For someone with a Full Retirement Age of
67, starting at 62 reduces the benefit by roughly 30%!
Full Retirement Age (FRA)
For most current P&G employees,
Full Retirement Age is 67.
At this age, you receive your
full primary insurance amount (PIA).
This is also when:
- earnings limits disappear
- spousal strategies become simpler
Age 70 — Maximum benefit
Social Security increases
8% per year after Full Retirement Age.
That means waiting from
67 to 70 increases your benefit by 24%.
For many retirees, this makes Social Security the
best inflation-adjusted annuity available anywhere.
Why Many Retirees Choose to Delay
Waiting increases three important things:
Lifetime guaranteed income
A larger benefit creates a stronger
income floor in retirement.
Survivor protection
The surviving spouse receives the
higher benefit.
Delaying can significantly increase the survivor benefit.
Inflation protection
Social Security receives
annual COLA adjustments, which make the larger benefit even more valuable over time.
But Delaying Isn’t Always the Right Move
There are good reasons someone might start earlier.
Health concerns
If longevity is uncertain, starting earlier may make sense.
Cash flow needs
Some retirees prefer to use Social Security to cover spending early rather than drawing down investments.
Tax planning opportunities
Sometimes it makes sense to
delay Social Security while doing Roth conversions or capital gain harvesting.
This can reduce taxes over a lifetime.
The Break-Even Age
Many people think about Social Security using a
break-even analysis.
For someone deciding between 62 and 70, the break-even age is often around
80–82.
If you live beyond that, delaying tends to produce more lifetime income.
But break-even analysis alone misses an important point.
Social Security Is Insurance
Think of Social Security less like an investment and more like
longevity insurance.
Delaying increases your protection against the risk that:
You live longer than expected.
For retirees with strong savings—something common among long-tenured P&G employees—this can be a valuable hedge.
The Portfolio Interaction
Another key consideration is how Social Security fits into your broader plan.
Sometimes it makes sense to:
- Spend
taxable assets earlier
- Delay Social Security
- Allow the guaranteed income to grow
In other situations, starting benefits earlier helps
preserve investment assets.
The right answer often comes from looking at
the entire retirement picture.
A Decision That Deserves Real Planning
Choosing when to start Social Security is rarely a one-size-fits-all decision.
It should consider:
- Longevity expectations
- Portfolio size
- Taxes
- Spousal benefits
- Income needs in retirement
For many P&G retirees, this decision becomes one of the most important pieces of the retirement plan.
