Choosing when to claim Social Security can have a lasting effect on retirement income. While eligible Americans can generally begin collecting benefits at 62, starting early can result in a permanently smaller monthly payment.
For married couples, the decision can become more complicated because two claiming dates need to work together. One spouse may benefit from claiming earlier while the higher earner waits, potentially increasing the household’s long-term income.
Financial advisor Michael Joyce of CW Advisors says understanding these tradeoffs is important before making a filing decision. For people who can afford to delay benefits, waiting longer can provide a substantially larger monthly payment.
Timing
Social Security claiming decisions often come down to balancing immediate income against a larger benefit later.
For people born in 1967 or later, full retirement age is 67. Claiming before that age results in a permanent reduction in the monthly benefit. On the other hand, delaying benefits beyond full retirement age can increase payments through delayed retirement credits until age 70.
Joyce said benefits can grow by about 8% per year for people who delay claiming after full retirement age, up to age 70.
That difference can become significant over a long retirement. Someone who does not need Social Security immediately may therefore want to compare the value of receiving smaller payments earlier with the potential benefit of receiving larger payments later.
Early
Age 62 is the earliest claiming age for most workers, but it comes with a considerable reduction in monthly benefits.
The reduction is permanent, meaning the beneficiary generally receives the lower amount for the rest of their retirement rather than seeing the payment automatically rise to the full-retirement-age amount later.
This does not mean claiming at 62 is always the wrong choice. Someone with limited savings, health concerns or immediate financial obligations may have a practical reason to begin collecting earlier.
However, Joyce generally advises people to consider waiting closer to full retirement age when their financial circumstances allow.
Delaying
Waiting until 70 can provide the highest monthly retirement benefit available through delayed claiming.
The additional income can be particularly valuable for someone who expects to live well into retirement. A larger monthly benefit can also provide more protection against future expenses, especially when other sources of retirement income are limited.
The tradeoff is straightforward: delaying means giving up several years of Social Security payments in exchange for larger checks later.
That makes life expectancy, savings and household expenses important parts of the decision. There is no single claiming age that produces the best outcome for everyone.
Couples
Married couples have additional options because each spouse has an individual Social Security benefit.
Joyce described a strategy in which the spouse with the higher earnings record delays claiming until age 70, while the spouse with the lower earnings record claims around full retirement age.
The idea is to allow the higher earner’s benefit to grow while still bringing some Social Security income into the household.
This approach can be useful when one spouse has consistently earned more and the household has enough other resources to cover expenses while waiting.
The right decision depends on the couple’s specific earnings records, ages and financial circumstances. A strategy that works well for one couple may not be appropriate for another.
Variables
Several factors can change the best time to claim.
The age difference between spouses is one consideration. A significant difference in age can affect how long each person is likely to receive benefits and how survivor benefits could fit into the household’s planning.
Employment is another factor. Someone who continues working while claiming Social Security may need to consider how earnings can affect benefits before full retirement age.
Income and taxes can also matter. Higher-income households may face additional tax considerations, while Medicare premiums can affect how much of a Social Security payment actually reaches a beneficiary.
Health and expected longevity are equally important. Someone with a shorter expected retirement may place greater value on receiving benefits earlier, while someone expecting a long retirement may benefit more from maximizing the monthly payment.
Planning
Before claiming, married couples should compare several scenarios rather than focusing only on the payment available at age 62.
They can examine what their household income would look like if one spouse claims at full retirement age while the other waits until 70. They can also compare those results with claiming earlier or having both spouses delay.
The Social Security Administration provides online tools that can help workers review their earnings records and estimate benefits at different claiming ages. A financial advisor can also help incorporate taxes, investments, Medicare costs and other retirement income into the decision.
For people who need Social Security to pay for essentials such as groceries, housing or vehicle expenses, waiting may not be financially realistic. In those circumstances, claiming earlier can provide needed cash flow.
The central issue is not simply whether to claim at 62, 67 or 70. It is whether the claiming strategy fits the household’s income needs, health outlook, savings and long-term retirement goals. For married couples, coordinating the two benefits can make the decision even more important, particularly when one spouse has a substantially higher earnings record.
FAQs
What is full retirement age for those born in 1967?
Full retirement age is 67 for people born in 1967 or later.
Can Social Security be claimed at 62?
Yes, but claiming early permanently reduces the monthly benefit.
Why wait until age 70?
Delaying can increase monthly benefits through delayed retirement credits.
Can married couples coordinate benefits?
Yes, spouses can coordinate their claiming ages based on their circumstances.
What affects the best claiming age?
Health, income, savings, work status and Medicare costs can all matter.
