You can claim Social Security retirement benefits as early as age 62. However, claiming early means that your monthly benefit payments, and potentially your overall lifetime payout amount, will be lower than if you wait until your Full Retirement Age (FRA) for Social Security. There are a number of advantages gained by waiting to claim your benefits until your FRA. These mainly include:
- Claiming higher benefits that are not reduced by starting early.
- Gaining the ability to earn income without losing any of your Social Security benefits.
- Avoiding any dilution of survivor benefits if ever applicable.
We discuss these and other considerations.
Full Retirement Age for Social Security
Your full retirement age (FRA) for Social Security depends on the year you were born as shown below. Beginning in 2027, the FRA age will remain at 67 regardless of your year of birth.
| If you were born in: | Your full retirement age is: |
|---|---|
| 1959 | 66 and 10 months |
| 1960 and later | 67 |
Qualifying for Retirement Benefits
When you work and pay Social Security taxes, you earn credits (up to 4 per year). Everyone born after 1928 must attain 40 credits (the equivalent of working for 10 years) in order to qualify for Social Security retirement benefits. You can view your Social Security statement online by setting up a ‘my Social Security’ account.
Estimating Your Benefits
Your Social Security retirement benefit is based on your earnings and years in the workforce. Years of low or no income reduce your entitlement.
The age at when you begin claiming retirement benefits also affects your monthly payment. You can start claiming benefits as early as age 62, or delay benefits up to age 70. The longer you wait to claim, the higher your monthly payment will be. You can estimate your retirement benefits using the benefit calculator.
Delaying Social Security Retirement Benefits
You don’t have to begin claiming benefits when you reach your Full Retirement Age. Delaying your benefits increases your future monthly benefits by approximately 8% for every year you delay, up to the maximum age of 70.
When to Claim Retirement Benefits
When to start receiving Social Security retirement benefits depends upon many personal considerations, including:
- whether you plan to continue working
- your health, family health history, and potential longevity
- various lifestyle considerations
How Work Impacts Retirement Benefits
If you claim early Social Security benefits before Full Retirement Age and continue to work, $1 of benefit will be withheld for every $2 you earn over an earnings limit that adjusts each year. Waiting to begin benefits until your Full Retirement Age avoids any loss of benefits.
Retirement Benefits for Family Members
If you’re receiving retirement benefits, other family members may also be eligible for benefits. These may include:
- A spouse, 62 or older, married at least 1 year
- A former spouse, aged 62 or older, if you were married at least 10 years
- Your children over 18, if disabled
Eligible family members receive benefits of up to 50% of your benefit. However, their benefits could be reduced if you begin your benefits before your Full Retirement Age.
Additionally, if you claim your benefits before your Full Retirement Age and switch to receive a spousal benefit at a later age, your spousal benefits will be reduced due to the fact that you began receiving benefits before your Full Retirement Age.
How to Sign Up for Social Security
The Social Security Administration recommends contacting them up to a year before you plan on applying for benefits, especially if you have a government pension and may be subject to either a pension offset or windfall elimination provision. You should apply for Social Security benefits several months before your retirement. Call or visit your local Social Security office or complete an online application.
SageVest is committed to helping you maximize your financial benefits and opportunities. Our dedicated advisors review your Social Security options within the framework of your broader personal, wealth, and retirement objectives. Please contact us for more details.
