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Do good things really come to those who wait?

A recent study from life insurance company MassMutual found 40% of Americans aged 55 to 65 believe Social Security will be their biggest source of income in retirement, ahead of 401(k) plans, investments and pensions.

Orman explains that for every month past your 62nd birthday you don’t claim Social Security, you’ll snag a slightly larger payout when you do start receiving your benefits.

For example, folks born in 1960 or later, whose full retirement age is 67, would see their benefits reduced by about 30% if they start claiming them at 62, according to the Social Security Administration.

This means a juicy $1,000 benefit would be shaved down to $700 instead.

Of course, there are a few factors that might cause folks to take their benefits early. A person aging in poor health might feel more motivated to claim their benefits at 62, especially if they’re concerned they might not make it to their 80s or 90s.

But Orman says other people could be experiencing “loss aversion” — worried about losing out by postponing their monthly checks.

“I get it,” Orman says. “Those reasons point to the fact that we are human beings who have to navigate hard psychological and emotional hurdles to arrive at the best financial decision.”

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Orman says you need to start planning now

Orman encourages prospective retirees to consider waiting to really optimize their benefits — but adds that they need to start planning and to make a decision earlier rather than later.

“This is not a decision you can just shelve until you are 61,” Orman warns. “If you haven’t made plans to delay claiming your Social Security at that point, chances are you will just go ahead and start at 62.”

If you’re planning on waiting until your full retirement age to claim your benefits, you’re going to need some income to offset the gap. You might extend your employment into your 60s, or consider working part-time instead.

The other option is to tap into your retirement savings — but you’re going to need to plan for a substantial nest egg long before you enter your golden years.

There are a few ways to grow your savings, like growing your money in a tax-advantaged account. Orman also recommends investing at least 10% (ideally 15%) of your income in your 401(k).

You could start buying shares in real estate, like vacation homes and rental properties. Or consider hedging your portfolio against inflation with shares in institutional-quality properties leased by national brands like Whole Foods and CVS.

It can also be helpful to work with a financial adviser to assess your financial situation and set you on a roadmap to achieving your financial goals — such as delaying the age you receiving your Social Security benefits and managing on your savings.

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Serah Louis is a reporter with Moneywise.com. She enjoys tackling topical personal finance issues for young people and women and covering the latest in financial news.

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