One of the most impactful financial choices you’ll make for retirement involves deciding when to start receiving Social Security benefits. While your monthly payment is largely determined by your earnings history, the age at which you claim also plays a major role in how much you get.
You’re eligible to begin claiming Social Security at age 62. However, if you were born in 1960 or later, your full retirement age (FRA) is 67. That’s when you can collect your full monthly benefit without any reductions.
There’s also the option to delay your benefits beyond your FRA. For each year you wait—up to age 70—your monthly benefit increases by about 8%. While holding out for a higher payout sounds like a smart strategy, waiting until 70 doesn’t work for everyone. Here are three reasons why you might want to consider claiming earlier.
1. Your Job is Negatively Affecting Your Well-being
Delaying benefits until 70 often assumes you’ll continue working until then. But if your job has become a source of stress or physical strain, it may not be worth the wait. Whether it’s due to a toxic boss, an unmanageable workload, or simply no longer finding joy in what you do, continuing to work could harm your mental and physical health.
If you’re already nearing full retirement age and your job is making you miserable, stepping away earlier—even if that means collecting a reduced Social Security benefit—could offer much-needed relief and improved quality of life.
2. A Decline in Health Changes Your Outlook
Health conditions can emerge suddenly, even if you’ve been relatively healthy all your life. If your health has recently declined, it might be wise to rethink your strategy.
Delaying benefits typically makes the most sense if you expect to live well into your 80s or 90s. But if medical issues are making you question that longevity, starting benefits earlier could help you maximize your total lifetime payout. Waiting until 70 might mean larger monthly checks, but if your time horizon shortens, you could ultimately receive less in total.
3. You Have a Strong Retirement Savings Cushion
If you’re counting on Social Security to cover a large portion of your retirement expenses, waiting until 70 might make sense. But if your personal savings have grown significantly, you might not need to rely so heavily on a larger monthly benefit.
For example, if your investment accounts have reached $2 million or more, you might be in a good position to claim benefits at your full retirement age—or even earlier. This could give you the chance to enjoy retirement while you’re still in good health, with plenty of financial security from your savings to support your lifestyle.
The Bottom Line
Claiming Social Security at age 70 can lead to higher monthly payments, which is attractive for many retirees. But if your job is becoming unbearable, your health is slipping, or your savings are already strong, it may be worth rethinking that strategy.
Everyone’s retirement journey is different, so it’s essential to evaluate your own circumstances carefully. A well-timed claim can make a big difference in your comfort, peace of mind, and overall satisfaction during your golden years.
FAQs
What is the earliest age I can start receiving Social Security benefits?
You can start claiming Social Security benefits as early as age 62. However, doing so will result in a reduced monthly benefit compared to waiting until your full retirement age or later.
How much more can I get by delaying Social Security until age 70?
For each year you delay benefits past your full retirement age (up to age 70), your benefit increases by approximately 8% per year. This can result in a significantly larger monthly payment.
Will my Social Security benefits be taxed?
Yes, depending on your total income in retirement, up to 85% of your Social Security benefits may be subject to federal income tax.
Can I change my mind after claiming Social Security early?
Yes, but with limitations. You can withdraw your application within 12 months of claiming and repay all the benefits you’ve received. This allows you to reapply later for a higher benefit. You can only do this once in your lifetime.