Claiming Social Security Benefits: What You Need to Know

You can start claiming Social Security retirement benefits as early as age 62, but there’s a catch: if you do so before reaching your full retirement age (FRA), your monthly benefits will be permanently reduced. On the flip side, waiting until you’ve reached FRA can actually boost your monthly payment.

Deciding when to claim these benefits isn’t straightforward; it really depends on your health, financial situation, and how long you expect to live. Understanding how your age at claiming affects your benefits is crucial.

When Can You Collect Social Security?

If you’re thinking about taking Social Security at 62, that might work if you have health issues, need the cash flow, or have other reasons for starting benefits early. Just keep in mind that this decision will reduce your monthly payments over time.

Here’s a simple breakdown for someone with an FRA of 67: this illustration doesn’t factor in cost-of-living adjustments (COLAs), retirement income, taxes, or other costs:

• Age 62-67: 30% reduction
• Age 63-67: 25% reduction
• Age 64-67: 20% reduction
• Age 65-67: 13.3% reduction
• Age 66-67: 6.7% reduction

Benefits of Claiming at Full Retirement Age

Your full retirement age is when you can collect 100% of your Social Security benefits. The federal government has been incrementally increasing the FRA from 65 to 67 since the year 2000. For individuals born in 1959, the FRA is 66 years and 10 months. If you were born in 1960 or later, your FRA is 67.

Maximizing Your Benefits

If you can hold off on claiming benefits until after your FRA, good news: you may qualify for delayed retirement credits, which can increase your monthly benefits up to age 70. For example, if you were born in 1960:

• At age 68, you could receive 108% of your full benefit.
• At age 69, 116% of your full benefit.
• At 70, a whopping 124% of your full benefit.

Waiting to claim could enhance your financial security in retirement, but data from 2025 indicates that only about 8.5% of seniors chose to wait until 70. The median age for those starting to claim benefits typically falls between 64 and 65.

Timing Your Claim

Choosing when to apply for Social Security depends on various factors, like your savings, health, lifespan, and future work plans. It’s worth considering how your chosen age could impact your retirement finances.

Ask yourself these questions to help with your decision:

1. How much income will I need in retirement?
2. Do I have enough savings to support myself if I delay benefits?
3. If I’m 62 and my FRA is 70, how much will I be receiving?
4. What’s my health status? How long can I expect to live?
5. How will an early claim affect my benefits?
6. What other income sources do I have for retirement?
7. How might this decision impact my spouse’s benefits?
8. Do I value receiving more now or having a higher income later?

Supplementing Social Security

Keep in mind that Social Security typically covers only a portion of what you might need during retirement, so it’s wise to consider other savings options.

1. Retirement Accounts

If you have a 401(k), make sure to contribute enough to snag any employer match—the typical range is around 2% to 6% of your annual salary. Individual Retirement Accounts (IRAs), unlike workplace plans, can be continued even if you switch jobs. Traditional IRAs grow tax-deferred but will incur taxes on withdrawals. If you go for a Roth IRA, you’ll pay taxes on contributions now, but both growth and withdrawals in retirement will be tax-free.

2. Pensions

The sale of annuities hit a record high recently. These can be bought as lump sums or through installments, often growing at fixed or variable rates. Some annuities are tied to market indices, offering both gains and caps on losses.

3. Investments

Other investment vehicles, like stocks, bonds, and CDs, can additionally aid in income during retirement. Vanguard is a solid choice for various mutual funds and retirement planning tools.

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