It can be really hard to know when you should claim your first Social Security check. After all, there's an eight year window of time from age 62 to age 70 when you can begin payments. And the longer you delay beyond 62, the higher your benefits grow but the more payments you forgo early on.
While the right approach depends on many factors, one thing is clear: the data demonstrates delayed claims pay off for most people. In fact, one recent study shows just how much waiting can pay for high earners.
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This is how much extra a high earner could get if they delay their Social Security claim
Recent research into the value of delaying a Social Security claim showed just how profound an impact waiting can have for those on the upper end of the income scale.
The research looked at benefits that would be provided to a hypothetical high-earning man or woman who was born in 1959 and who had $100,000 in average earnings used to calculate their standard Social Security benefit.
Based on these assumptions, here was the expected present value of Social Security benefits for these hypothetical men and women, with the value weighted based on estimated mortality.
| Age | Healthy Male | Healthy Female | Average Male | Average Female |
|---|---|---|---|---|
| 62 | $582,578 | $617,212 | $486,005 | $550,815 |
| 63 | $602,762 | $639,870 | $499,291 | $568,730 |
| 64 | $619,762 | $659,306 | $509,552 | $583,500 |
| 65 | $645,946 | $688,701 | $526,904 | $606,745 |
| 66 | $667,847 | $713,753 | $540,232 | $625,769 |
| 67 | $685,400 | $734,383 | $549,522 | $640,516 |
| 68 | $707,465 | $760,093 | $561,901 | $659,276 |
| 69 | $724,294 | $780,463 | $569,531 | $672,934 |
| 70 | $737,399 | $797,011 | $573,931 | $683,017 |
Data source: The Value of Delayed Social Security Claiming for Higher-Earning Women
Now, the Social Security benefits formula was designed to try to equalize out lifetime benefits paid regardless of when they were claimed. That's why early filing penalties reduce a standard benefit for those who claim their payments early while delayed retirement credits increase a standard benefit for late claims.
But as the preceding table shows, this formula no longer really works as intended. An average male who claims benefits at 62, for example, will end up with Social Security benefits worth $87,926 less than if he'd claimed at 70 while an average female will see $132,202 more over her life due to a delayed claim.
The numbers are even more dramatic for those who are healthy, with a delayed claim resulting in benefits worth $179,999 more for a healthy woman and $154,821 for a healthy man who waits until 70 instead of claiming at 62.
The fact that the Social Security benefits formula was designed based on average life expectancies, not each recipients own individual life expectancy, helps to explain why delay typically results in such a big windfall compared to an early claim.
Is a delayed Social Security benefit right for you?
While these numbers apply to high earners, the reality is that the majority of retirees end up better off if they delay their Social Security claim as long as possible. So, for most people, waiting is the right move.
Of course, this isn't the case for everyone. For example, sometimes it makes sense for a lower earning spouse to get their benefits early in order to provide income for the couple while the higher earner delays and maximizes their bigger benefit. Or a single person in poor health typically ends up better off claiming early because they may not live long enough to break even and don't need to worry about survivor benefits.
Still, unless there's a specific reason to claim early, putting off your benefits claim may just be the best move as it could help you get tens or even hundreds of thousands more value from the Social Security program.
