When to Take Your Social Security Benefit: A Key Retirement Decision
If you’re starting to think about retirement, one of the biggest questions you might be asking is: When should I start taking Social Security? While age plays a big role, it’s far from the only factor. Just like retirement itself, the right timing depends on your unique circumstances and how they come into play when making this important decision.
Should I Claim My Social Security Benefit Now, or Later?
You are eligible for your “full” benefit in the year you reach your Full Retirement Age (FRA), which is based on your birth year.
Year You Were Born:
Full Retirement Age:
Reached In:
1943-1954
66
2020 or earlier
1955
66+2 months
2021-22
1956
66+4 months
2022-23
1957
66+ 6 months
2023-24
1958
66+ 8 months
2024-25
1959
66+10 months
2025-26
1960 or later
67
2027 or later
While you can take benefits as early as age 62, your full benefit amount will be permanently reduced a bit for each month you begin before reaching your FRA. For example, someone whose FRA is 67 but starts five years early at age 62 will only receive 70% of what they would have received at 67.
On the other hand, if you delay starting benefits beyond FRA, your benefits will increase by two-thirds of 1 percent for each month that you wait to claim them (which adds up to 8% for each full year), up to age 70. Someone whose FRA is 67 but delays benefits until 70 would receive 24% more (8% per year for three years).
Take note that there are also other instances where you may qualify for a benefit earlier than 62: a spouse or divorced spouse may be eligible earlier if caring for a child under the age of 16. Additionally, benefits may be available to dependent children and surviving spouses as young as age 50 if they meet specific criteria, such as being disabled or having caregiving responsibilities.
Considerations for When to Take Your Social Security Benefit
So, the decision on when to take benefits comes down to taking a smaller amount earlier or waiting to take a larger amount later. Which strategy makes the most sense for you? There are several factors to consider.
Social Security Consideration #1: Life Expectancy
Maybe the biggest factor to consider is how long you’ll live in retirement. The Social Security Administration provides a longevity calculator, using your gender and birthdate, to estimate how long you’ll live in retirement. Since this calculator is based on averages, it’s important to weigh your personal health and your family’s health history as part of the calculation.
The general rule of thumb: the longer you expect to live, the more you’ll collect over your lifetime by deferring your benefits. If you have a reasonable expectation of living decades past retirement, postponing benefits to get a bigger payment could prove important to your long-term financial stability. But if you turn 62 in poor health, or have a genetic predisposition to certain illnesses, you may decide to get what you can, while you can.
Takeaway: Most analyses would say that roughly age 80 is the tipping point – if you think you’ll live at least that long, you’re better off delaying benefits as long as possible. Surprisingly, only 10 percent of all Social Security recipients hold out until age 70,1 even though delaying may be the right answer for many.
Social Security Consideration #2: Employment
There’s also the question of how long you expect to be steadily employed. Many older workers retire earlier than planned, which can make claiming Social Security before reaching Full Retirement Age a practical – if not necessary – option.
Takeaway: As long as you can keep working, the smart move is usually to delay as long as possible. An important factor to keep in mind: If you file for benefits before you reach your Full Retirement Age, your earnings could subject you to limits that could reduce (and even eliminate) your Social Security payments. Once you hit FRA, you can keep whatever earnings you make without it affecting your benefit.
Social Security Consideration #3: Healthcare
Lastly, taking Social Security early can impact your ability to take advantage of another savings tool. If you receive Social Security benefits, you will be automatically enrolled in Medicare Part A once you reach age 65, and being enrolled in any part of Medicare means you’re no longer able to contribute to a Health Savings Account. You can still use the HSA to pay for medical expenses, but you can’t add to it.
Takeaway: If you’re planning to continue HSA contributions, you’ll want to delay starting Medicare – which may mean delaying Social Security.
Social Security Consideration #4: Family Considerations
A spouse, minor or disabled children, and dependent parents can all potentially be eligible to collect your benefit based on your earnings history. If you begin collecting a Social Security benefit, other family members may also be entitled to receive benefits, up to the family maximum. Below are a few considerations for whether to claim early, or later:
It may be more advantageous to retire and take your benefit early, allowing other family members to receive benefits, in lieu of deferring benefits to receive a higher amount later.
Benefits for a surviving spouse could be reduced if you claim your own benefits early. It is important to consider the circumstances and health considerations of your family carefully before a decision can be made regarding when to begin benefits in this case.
Takeaway: Oftentimes, taking a benefit before full retirement age just to trigger dependent benefits does not lead to the highest cumulative benefit received by the family, due to the lifetime reduction in that individual’s benefit, coupled with the fact that any survivor’s benefit would also be reduced.
Maximizing Your Social Security Benefit
These are just a few of the considerations when it comes to taking your Social Security benefit. For a comprehensive guide on Social Security retirement benefits – including details on taxation and advanced planning strategies – reach out to your Baird Financial Advisor team for a copy. They can also conduct a social security analysis to identify the optimal age for you and your spouse to claim your benefits.
This article was originally published in December 2019 and was updated with more current information in July 2025.
The information offered is provided to you for informational purposes only. Robert W. Baird & Co. Incorporated is not a legal or tax services provider and you are strongly encouraged to seek the advice of the appropriate professional advisors before taking any action. The information reflected on this page are Baird expert opinions today and are subject to change. The information provided here has not taken into consideration the investment goals or needs of any specific investor and investors should not make any investment decisions based solely on this information. Past performance is not a guarantee of future results. All investments have some level of risk, and investors have different time horizons, goals and risk tolerances, so speak to your Baird Financial Advisor before taking action.
1 3 Reasons to Claim Social Security Early (and 3 Reasons to Wait Until 70), AARP, 2023
