The economic downturn has certainly taken its toll on those who are close to retirement. A new survey confirms the desperate mood.

A survey by Fidelity Investments found that 45% of Americans aged 61 expect to start taking Social Security at age 62 -- in other words, as soon as they're able. Why? Well, 77% of them say they need the money for such basic expenses as food, utilities, and mortgage payments.

Now consider this: These 61-year-olds are counting on Social Security to provide up to half of their income in retirement -- yet, only 22% know how much they'll be getting. What kind of planning have they been doing? Not much, it seems. Indeed, about 73% of them have not drawn up any kind of formal retirement plan. At Fidelity, Carolyn Clancy notes, "Social Security currently only funds a little more than one third, or 37%, of an average retiree's income."

The big question
It's a key question to answer as you plan your retirement: When to begin taking Social Security. For many of us, full benefits become available at age 66 or 67. Taking them early, at 62, gives us reduced income for the rest of our lives, but it also gives us some income for those four or five years before our full retirement age. Waiting until age 70 can give us up to 75% more income -- beginning eight years later. Read Dave Braze's detailed look at this question -- and Dan Caplinger's provocative suggestion for how you may be able to have it both ways, partly by investing in relatively steady, dividend-paying blue chips like these:


Recent dividend yield

Texas Instruments (NYSE:TXN)




General Dynamics (NYSE:GD)


Walgreen (NYSE:WAG)


Corning (NYSE:GLW)


GlaxoSmithKline (NYSE:GSK)


Lowe's (NYSE:LOW)


Times have changed
Interestingly, my colleague Mary Dalrymple wrote last year about how relatively few Boomers were planning on taking Social Security early. I think that the past year's slide into a recession has changed things. You may not have planned on it, but if you or your spouse is suddenly out of work, or your stock portfolio has shrunk by 40%, you may be eyeing it more closely now.

Think twice, though. Take some time to read about the issue and to draft a retirement plan. Make sure you're making the wisest decision, given your situation. You can learn more in these articles:

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.