By When Should You Take Social Security Benefits: At 62, 67, or 70?
Deciding when to start receiving Social Security benefits is one of retirees’ most critical financial decisions. While Social Security eligibility begins at age 62, waiting until Full Retirement Age (67 for those born in 1960 or later) or delaying until age 70 can significantly impact monthly payments, total lifetime, and survivor benefits. This article explores the financial implications of claiming benefits at different ages, guiding the best options based on individual circumstances.
Social Security Benefit Amounts by Age
Your monthly Social Security benefit amount depends on when you start claiming:
- Claiming at Age 62 (Early Retirement): Social Security allows you to begin receiving benefits as early as 62, but this comes with a permanent reduction of approximately 30% compared to Full Retirement Age (FRA). For example, if your FRA benefit is $2,000 per month, claiming 62 would result in a reduced benefit of about $1,400.
- Claiming at Age 67 (Full Retirement Age – FRA): You receive 100% of your entitled benefit at this age. If your calculated benefit at FRA is $2,000, that is the amount you will receive.
- Claiming at Age 70 (Delayed Retirement Credits): If you delay benefits past your FRA, your monthly payment increases by approximately 8% annually until age 70. This results in a benefit increase of about 24%, meaning a $2,000 benefit at FRA would grow to roughly $2,480 per month at age 70.
Which Option Provides the Most Financial Benefit?
To determine the most financially advantageous claiming age, consider the following factors:
- Longevity and Life Expectancy:
- If you expect to live into your late 80s or 90s, delaying benefits may be beneficial as it increases total lifetime payments.
- If you have health concerns or a family history of shorter life expectancy, claiming earlier might be the better option.
- Financial Needs and Income Sources:
- If you need income immediately, claiming at 62 might be necessary.
- If you have other retirement savings or income streams, delaying Social Security can provide greater financial security in later years.
- Employment Considerations:
- If you continue working while collecting benefits before FRA, Social Security imposes an earnings limit ($21,240 in 2025). Earnings above this limit reduce your benefits temporarily.
- Once you reach FRA, you can work without any benefit reduction.
- Survivor Benefits for a Spouse:
- If you claim benefits at 62, your spouse’s survivor benefits may be reduced.
- Delaying benefits increases the survivor benefit amount your spouse can receive after your passing.
Surviving Spouse Benefits and the Impact of Claiming at 62
Taking Social Security early at 62 permanently reduces the benefit your surviving spouse could receive. The maximum survivor benefit is generally based on the amount the deceased spouse was receiving or entitled to receive at the time of death:
- If you claim at 62, the survivor benefit is reduced to the lower amount you were receiving.
- If you wait until FRA or later, your spouse can receive a higher survivor benefit.
- If you delay benefits until 70, your surviving spouse can receive maximum benefits.
Recommendations for Claiming Social Security
- Best for Maximizing Monthly Benefits: Delay until 70 if possible, as it provides the highest lifetime benefits and better financial security.
- Best for Those in Need of Immediate Income: Claim at 62 if you require Social Security for financial support and have no other retirement income.
- Best for Balancing Financial and Health Considerations: Claiming at 67 (FRA) provides a full benefit amount without reductions, making it a solid middle-ground option.
Final Thoughts
There is no one-size-fits-all answer to when to claim Social Security. Factors such as financial situation, life expectancy, employment, and spousal benefits play a role. Consulting with a financial advisor and using the Social Security Administration’s online benefits calculator can help determine the best decision for your circumstances. Ultimately, making an informed choice will ensure you maximize your Social Security benefits for a more secure retirement.
