As of Jan. 2024, the average monthly Social Security benefit was $1,907.
Your own personal monthly benefit will almost definitely be different from this amount. It can be affected by many factors, including how long you've worked and your earnings throughout your career.
You can't do much about these factors once you're close to retirement age since your career earnings and work history aren't likely to change too much at that point. What you can do, though, is make a strategic choice about when you start your benefits.
To do that, it's important to understand how your claiming age will affect the payments you get. So, let's take a look at how the average benefit differs at 62 versus 70.
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Here's the average Social Security benefit at 62 vs. 70
At 62, retirees get an average monthly Social Security payment of $1,298.26. But at 70, they receive an average of $2,037.54. That's a difference of $739.28 per month.
Now, we don't know exactly when those 70-year-olds claimed their benefit. They may have started their checks at a younger age, and their payments have gone up over time thanks to cost-of-living adjustments. Or they may have waited until their 70th birthday to receive their first payment.
But one thing is clear. The 62-year-old Social Security recipients have a much lower average monthly benefit than their older peers -- and a much lower benefit than the overall average. That's because 62 is the earliest age you can claim retirement benefits, but an early claim comes at a price.
The sad reality is, the sooner you get your first payment, the more early filing penalties you're subject to and the lower your benefit will be.
Here's how the average benefit is affected by your claiming age
To understand the cost of an early claim, consider what would happen to a worker in line to get the average $1,907 monthly benefit at their full retirement age (67 for the purposes of this discussion).
If this person filed for benefits at 62, they would be subject to five years of early filing penalties. These equal:
- 5/9 of 1% per month for the first 36 months of their early claim.
- 5/12 of 1% per month for the additional 24 months they claim early.
The total reduction adds up to 30% if you claim at 62 with an FRA of 70, so the $1,907 monthly benefit would fall to just $1,334.90. If this person waited until 70 instead, they would receive three years of delayed retirement credits. These equal:
- 2/3 of 1% per month or 8% per year.
With three years of these credits, that $1,907 monthly benefit would become $2,364.68. From 62 to 70, this person would see a difference in their monthly check of $1,029.78, or $12,357.36 per year. That's a huge difference for the typical retiree.
Here's the hard truth about your Social Security claim
The bottom line: Most people end up better off by waiting to claim benefits. There are exceptions, especially for unmarried people in poor health, as they may not live long enough for their higher future payments to make up for income they missed by waiting.
But for most people, the benefits increase that comes from putting off a Social Security claim is substantial. It provides more money later in life, when you may have health issues and dwindling retirement account balances. And it maximizes their chances of collecting the most lifetime income.
So, if you haven't claimed Social Security yet, you should think seriously about putting off your claim as long as you can. Otherwise, you could find yourself with less income than your peers who managed to delay.
