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Patience in waiting to retire will lead to a greater return from Social Security. | Photo courtesy of Jim McGuire/Getty Images

Kotlikoff: When it comes to Social Security, patience provides a tremendous return



Patience in waiting to retire  will lead to a greater return from Social Security. | Photo courtesy of Jim McGuire/Getty Images
Patience in waiting to retire will lead to a greater return from Social Security. | Photo courtesy of Jim McGuire/Getty Images

Andrea – Lihue, Hawaii: My husband is 66. I am 58. We are employed as teachers. My husband is healthy and still has energy for this job. We have a ton of credit card debt, plus loans for two children going through college and a loan for my master’s degree. The credit cards were used for travel for our children to and from college and for us to visit aging parents. We live far away from family, and our children went to college out of state. Not the best decision now with the debt, but when you live in Hawaii and all the family is on the mainland, our kids didn’t even consider in-state universities.

Here is my question: Should my husband take Social Security benefits at his full-retirement age and use it to pay down credit card debt? Should he wait until age 70 with $25,000 credit card debt and try to continue with monthly payments? Do we have any options with student loans?

Larry Kotlikoff: You have a complex situation, and only expert life-cycle financial planning software can assist you. Social Security provides a tremendous return to patience. If you have some other means of paying down the debt or if it doesn’t carry a huge interest rate, your husband should wait until 70. This will maximize his retirement benefit and also your widows benefit were he, God forbid, to pass away.

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Laurence Kotlikoff

Boston University economist Larry Kotlikoff has spent every week, for over two years, answering questions about what is likely your largest financial asset — your Social Security benefits. Find a complete list of his columns here.

Kotlikoff’s state-of-the-art retirement software is available here, for free, in its “basic” version. His new book, “Get What’s Yours—the Secrets to Maxing Out Your Social Security Benefits,” (co-authored with Paul Solman and Making Sen$e Medicare columnist Phil Moeller) was published in February by Simon & Schuster.

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