Should You Take Social Security at 62, 67 or 70? - NerdWallet (2024)

FAQs

Should You Take Social Security at 62, 67 or 70? - NerdWallet? ›

Your full retirement age depends on the year you were born. You can start collecting Social Security at 62 but will receive reduced benefits. If you wait until 70, your monthly check will be more than if you'd retired at your full retirement age.

You can start receiving your Social Security retirement benefits as early as age 62. However, you are entitled to full benefits when you reach your full retirement age. If you delay taking your benefits from your full retirement age up to age 70, your benefit amount will increase.

1. You're Planning Your End-of-Life Care. Your Social Security benefits stop paying at your death, so if you die before collecting benefits, you'll have missed out on benefits entirely. You need to figure out how to maximize your Social Security income instead.

You could also opt to take benefits later, such as at age 70. While it may seem reasonable to start Social Security benefits as soon as possible, your monthly payments will be larger if you delay claiming. For each year you wait to take Social Security past your full retirement age, your benefits grow by 8%.

At around age 78 and 8 months, you reach the break-even point, when your cumulative benefits from claiming at 67 surpass those you'd get by taking retirement at 62.

The way Social Security is set up, the longer you wait to collect retirement benefits, the higher your monthly payment. Claiming benefits at age 62 means you will get the smallest possible check. Your check rises yearly past age 62 if you wait to collect.

Crystal Edwards: The advantage of taking retirement benefits early is that you start to collect the money that you've been paying over to the government monthly since you started working. The downside to that, however, is that it causes a permanent reduction in your Social Security retirement benefit.

Here's when Ramsey said you can claim Social Security at 62

The question focused on whether to start retirement benefits at 62 or wait until full retirement age. In response, Ramsey said that "it usually makes sense to take it early if you're going to ... invest every bit of it."

Have you heard about the Social Security $16,728 yearly bonus? There's really no “bonus” that retirees can collect. The Social Security Administration (SSA) uses a specific formula based on your lifetime earnings to determine your benefit amount.

There is no age at which you will no longer be taxed on Social Security payments. So, if those payments when combined with your other forms of income, exceed one of the two thresholds, then you will have to pay at least federal taxes on either 50% or 85% of the benefits you receive.

Why is it best to wait until you are 70 to take out Social Security benefits? ›

Social Security retirement benefits are increased by a certain percentage for each month you delay starting your benefits beyond full retirement age. The benefit increase stops when you reach age 70.

The Social Security five-year rule is the time period in which you can file for an expedited reinstatement after your Social Security disability benefits have been terminated completely due to work.

The full retirement age is 66 if you were born from 1943 to 1954. The full retirement age increases gradually if you were born from 1955 to 1960 until it reaches 67. For anyone born 1960 or later, full retirement benefits are payable at age 67.

You may request that your benefit begin in August with the first payment in September. By requesting that your benefit begin in your birthday month, you will receive the maximum possible monthly payment for the rest of your life.

You may be eligible to collect Social Security as early as 62, but waiting until age 70 yields greater benefits for most people.

When you reach age 70, your monthly benefit stops increasing even if you continue to delay taking benefits. If you decide to delay your retirement, be sure to sign up for Medicare at age 65. In some circ*mstances, medical insurance costs more if you delay applying for it.

A worker can choose to retire as early as age 62, but doing so may result in a reduction of as much as 30 percent. Starting to receive benefits after normal retirement age may result in larger benefits. With delayed retirement credits, a person can receive his or her largest benefit by retiring at age 70.

People may be starting their benefits early for sound financial reasons. In a Great Recession survival strategy, for example, laid-off baby boomers were claiming their benefits early. But there are also psychological reasons for prematurely starting Social Security even when it doesn't make financial sense.

You Have the Chance to Enjoy it Longer

Compounding this is that the stress of work can actually contribute to health issues, so if you stop working sooner, you may remain healthier longer. No longer having to work means you have time to work on yourself!

How much does your Social Security benefit increase annually from age 62 to 70? ›

You can start collecting Social Security retirement benefits at age 62. Each year you delay increases your benefit by 5% to 8%. Social Security benefits max out at age 70.

You can start earning benefits as early as age 62, albeit at a lower amount. You can increase your benefit amount by delaying them until 70, which is the age at which the monthly benefit is capped.

The full retirement age is 66 if you were born from 1943 to 1954. The full retirement age increases gradually if you were born from 1955 to 1960 until it reaches 67. For anyone born 1960 or later, full retirement benefits are payable at age 67.