What Age Should You File for Social Security? 62 vs 65 vs 67?
Social Security is a critical part of most people’s retirement plans, and knowing when to start drawing on those benefits is important. Having an idea of how much you could ultimately receive from Social Security can help you determine other parts of your plan, and help you reach your retirement goals, particularly when you rope in a retirement plan like a 401(k) or IRA.
Americans can start drawing Social Security benefits at age 62, but there can be benefits to waiting until full retirement age (67), or longer. Deciding when to apply for Social Security can be complicated, and there’s likely a different answer for each person depending on their circumstances. The earlier you file, the lower your benefit amount, but the more payments you receive over time. There are many other factors to consider when choosing your retirement date, but thinking early about your potential Social Security benefits, and how they can pair with a retirement plan like an IRA or 401(k) long before you need to tap those benefits, may be beneficial.
Key Points
• Social Security benefits can be claimed at 62, but increase if delayed until 67 or 70.
• Claiming at 62 results in reduced benefits – about 70% of full benefits.
• Full retirement age is 67, offering 100% of benefits. Delaying benefits until age 70 increases monthly payments by approximately 25%.
• Factors influencing when to claim include health, life expectancy, marital status, and financial situation.
• It may be wise to supplement your Social Security benefits by investing in a retirement account, such as an IRA.
How Might Social Security Impact When You Retire?
As noted, Social Security is likely an important part of your retirement plan. But it’s important to keep in mind that it’s only one part, as most people will likely need more savings and investments to fund their retirement. Knowing your potential Social Security benefits can, however, help you figure out what your additional or supplemental savings or investments need to amount to to give you the best chance of making them last.
With all of that in mind, you’ll want to give some thought to additional factors, such as your health and family situation, to help you figure out when you should start or plan to start drawing your Social Security benefits. For many people, it may be best to wait until full retirement age, rather than at the first opportunity. But again, thinking ahead is key, and giving consideration to how a retirement plan like a 401(k) or IRA can work in tandem with Social Security can be wise.
What Is Full Retirement Age (FRA)?
Full retirement age, as outlined by the Social Security Administration, is 67, assuming you were born in 1960 or later. As such, “full retirement age,” as it stands, is 67. That’s the age at which you’d be eligible for your full Social Security benefit. But as noted, that doesn’t mean you can’t start drawing Social Security benefits before that, and for some people, that may be a good idea.
The earliest you can apply for Social Security is age 62, but your benefits will be diminished. Conversely, if you wait longer (up to age 70), you could get more. So, if it’s possible to start drawing from a retirement plan without tapping your Social Security benefits, that may be a tactic to delay, and potentially receive more later on.
Here’s a look at the percentage of Social Security benefits that you could be paid monthly depending on the age at which you decide to retire (assuming you were born in 1960 or later):
Retirement age | Percentage of full Social Security benefit paid out* |
---|---|
62 | 70% |
63 | 75% |
64 | 80% |
65 | 86.7% |
66 | 93.3% |
67 | 100% |
68 | 108% |
69 | 116% |
70 | 124% |
*Data reflects percentages for those born in 1960 or later, with a full retirement age of 67.
Source: Social Security Administration
Claiming Social Security at 62 (Early Retirement)
The earliest most people can apply for Social Security is age 62. The greater the difference between when you apply and when you reach full retirement age, the more the Social Security Administration will reduce the amount of your benefit.
How Much Social Security Will You Get at 62?
As discussed, for those born in 1960 or later, full retirement age is 67. Taking retirement at 62 will cause your benefit to be reduced by about 30%.
If your benefit at full retirement would be $1,000 a month, and you file for benefits at 62, you will only receive about $700 or 70% of the amount you would have received at full retirement. For each month you wait past the age of 62, that amount rises a little bit. At $700 a month starting at 62, if you lived to the average U.S. lifespan of about 80 years old, you would receive $151,200 over your lifetime.
Benefits of Claiming Early
The benefit of claiming early is that you’d start seeing money sooner – potentially years sooner than if you had waited. Depending on numerous factors (health issues, etc.), this may be more advantageous to some people.
When Claiming Social Security at 62 Might Be a Good Idea
It may be a good idea to start claiming benefits early if you have health issues, or are unable to work or otherwise find a source of income. Again, you’ll take a hit in the form of a reduced benefit, but for some people, it may be worth it. However, it bears repeating: It all depends on your individual circumstances.
Claiming Social Security at 67 (Full Retirement Age)
Claiming Social Security at age 67, which is the full retirement age for people born after 1960, means you’re eligible for your entire, or 100%, of your benefits.
How Much Social Security Will You Get at 67?
If you wait to apply for benefits until full retirement, you will get the full amount of your benefit. In the example used above, that would be $1,000 a month. In this scenario, if you live to age 80, you would receive $156,000 over those retirement years, which is close to $5,000 more than if you filed five years earlier.
Benefits of Waiting Until Full Retirement Age
The most obvious benefit of retiring at 67 is that you get your complete Social Security benefit, without reduction. If you continue to work between 62 and 67 as well, you may also have more time to add to your savings and investments, too, to help you stretch your retirement accounts.
When Claiming Social Security at 67 Might Be a Good Idea
Claiming Social Security at 67 might be a good idea if you don’t have any immediate need to retire early. Waiting to get your entire benefit can be helpful, especially since retiring at, say, 62, would reduce that benefit by up to 30% – a decent percentage. So, if you have no immediate concerns about your health or ability to continue earning income, waiting may be a good idea.
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Delaying Social Security Until Age 70
Every month you delay applying for benefits causes the monthly benefit amount to grow, up until age 70. If you file at age 70, your monthly Social Security retirement payment is close to 25% higher than it would have been if you filed at full retirement.
How Much Social Security Will You Get at 70?
Continuing with our hypothetical scenario, rather than receiving $1,000 a month you would receive about $1,300 a month. If you live to age 80, that comes to $156,000 which is the same total amount you would receive if you filed at full retirement age. This brings into the equation one of the factors that influences at what age you may want to file for Social Security benefits: how long you expect to live.
Benefits of Delaying Your Social Security
The biggest benefit of delaying your Social Security benefits is, again, a larger benefit. If you stand to draw a significantly bigger benefit at 70 than you would at 62 or 67, it may be worth it to wait — so long as you’re able.
When Claiming Social Security at 70 Might Be a Good Idea
Your benefits won’t increase after age 70, so it may be a good idea to start claiming that at 70 whether you need to or not. And even if you are taking Social Security at 70, it doesn’t mean you need to stop working or generating income otherwise, either. But again, everything comes down to an individual’s specific circumstances.
What Factors Should You Consider When Deciding to Take Social Security?
Besides your age, there are some other key factors and variables you should keep in mind when deciding when to start drawing Social Security, or affect your retirement plan. Those include your health, life expectancy, whether you’re married or not, and your overall financial situation.
Health and Life Expectancy
No one knows for certain how long they will live. But if you expect to live only to age 75 for one reason or another, you might be inclined to take your Social Security benefit early so that you could enjoy it for a longer time. But if you live until age 90, taking Social Security retirement benefits early could cost you a lot of money. Here’s how your lifetime benefit would be impacted by filing at different ages if your full retirement benefit is $1,000 a month:
• At age 62, you would receive a total of $235,000 over your retirement years.
• At age 65, you would receive $260,100.
• At 67 that jumps to $276,000.
• If you wait until age 70 it is $312,000.
So, if you expect to live a long life, waiting a few years to file could make a big difference in your total benefit.
Financial Situation and Other Retirement Income
A lot, and perhaps a majority of the money spent after retirement goes toward typical retirement expenses of housing and healthcare. The average Social Security benefit as of 2024 was a little less than $1,800 per month. So an average married couple would receive around $3,600 in benefits.
Consequently, many people have to rely on other forms of income including wages from a job, pensions, dividends, interest or capital gains in addition to their Social Security benefit. In fact, having access to other forms of income may impact when you can retire.
If you do have income besides your Social Security benefit, you might want to delay claiming your benefit. If you earn income from working, and you claim your benefit before full retirement age, your benefit may be reduced. If you have other types of income, such as pensions or interest on the money you’ve saved in your retirement account, your benefit will not be reduced; these don’t count as earnings. However, you may have to pay taxes on it.
Spousal Benefits
There are many myths around Social Security benefits, so it’s important to delve into your particular situation. Spouses may be eligible for half of the benefit their spouse would receive at full retirement age. That amount is reduced if the primary beneficiary files early.
For instance, if the primary beneficiary or spouse were to apply for Social Security benefits before you reach full retirement age, you would automatically be deemed as applying for spousal benefits as well if your spouse is already receiving benefits. The maximum spousal benefit you can qualify for is typically 50% of your partner’s benefits calculated at full retirement age.
One option for spouses is to file for one spouse’s benefit early, say at 62, and postpone filing for the other spouse’s benefit until age 70. This can provide money now and more money later. If one partner dies, the surviving partner is automatically assigned the higher benefit between their own and their late spouse.
How Social Security Fits Into Your Retirement Plan
When it comes to how Social Security benefits ultimately slot in with your retirement plan, including your investments, it’s important to try and take a holistic, top-down view of your situation. The fact is, most people are not going to be able to get by during their retirement years on their Social Security benefits alone, so they’ll likely need some investments and savings to augment that income.
With that in mind, it may be a good idea to invest in, or consider opening up, a retirement plan if you haven’t already.
401(k)s and IRAs
To supplement your Social Security benefits, you may consider opening a retirement plan, which can include either a 401(k), if your employer offers one, or an IRA. There are differences and pros and cons between those two types of retirement plans, and it may be worth speaking with a financial professional to get a sense of what may work best for you.
But the goal should be to think about what you’ll need to supplement your Social Security benefits during retirement, and plan – save and invest – accordingly.
The Takeaway
For most people, their Social Security benefit is unlikely to sustain them through their retirement years; they need to have another source of income. The earlier they retire, the smaller their benefit will be and the more they may need a second or third source of income. Gaining that income through wages can reduce your benefit if you retire before full retirement age.
Ready to invest for your retirement? It’s easy to get started when you open a traditional or Roth IRA with SoFi. SoFi doesn’t charge commissions, but other fees apply (full fee disclosure here).
FAQ
Is it better to take Social Security at 62, 67, or 70?
The best time to take Social Security depends on your specific circumstances. But in a broad sense, waiting until 70 may be the best thing to do in order to maximize your benefits.
How much do you lose if you retire at 62 instead of 67?
If you retire at 62, you could see your benefits reduced by as much as 30% compared to what you would have received at age 67.
Photo credit: iStock/FG Trade
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