I've got a few decades before I can apply for Social Security, but even when I become eligible at 62, I probably won't sign up. As much as I want to start reaping its benefits, my main priority is getting as much money as possible.
Right now, I think claiming at 70 is my best move. Here are three reasons why.
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1. I expect to have a reasonably long life
Life expectancy is key when trying to maximize your Social Security benefit. You qualify for your full benefit at your full retirement age (FRA) -- 66 to 67 for most people. Claiming under this age shrinks your checks little by little. Those who apply immediately at 62 only get 70% to 75% of their full benefit per month.
Delaying slowly grows your checks until you qualify for your maximum benefit at 70. This is 124% to 132% of your full benefit. However, the drawback to waiting is that you'll have to cover your living expenses on your own until 70.
This isn't a good choice for those with serious health issues. Claiming early will almost certainly shortchange them and some may miss out on Social Security altogether if they die before they're able to sign up for benefits.
Obviously, I don't know how long I'll live. But I think I have pretty good odds of making it to my mid-80s or beyond since I'm a pretty healthy person now. In this scenario, delaying Social Security usually leads to a larger lifetime benefit than claiming early.
2. I'm prioritizing retirement savings now
Some people cannot afford to delay Social Security even if they want to because they lack the financial resources to cover their expenses independently until they're ready to apply. In this case, early claiming might be their only option to avoid debt.
I don't think this will be an issue for me because I set aside money for retirement every month. Right now, I feel pretty confident that I will have enough savings to cover my expenses until I'm ready to sign up for Social Security.
If something changes as I get closer to retirement, I might opt to claim a little earlier. Or if I'm healthy enough, I might work a little longer so I have a steady paycheck to help me cover my costs until I apply for Social Security.
3. I think my retirement benefit will be larger than my spousal benefit
I'm married, so I will qualify for a spousal Social Security benefit in addition to my own retirement benefit. In these situations, the Social Security Administration only gives you the larger of the two checks. And you can't claim a spousal benefit until your partner has already applied.
If I thought I'd get a larger spousal benefit in retirement, I'd be more tempted to apply for Social Security early. This could bring in extra cash that could help my husband delay his checks until he qualified for even more money. It wouldn't raise my spousal benefit -- the max is always one-half of what the worker qualifies for at their FRA. But it could boost our household Social Security benefits.
Since I don't think that's the case, our best move for maximizing benefits is to have both of us delay Social Security as long as we can. When we're ready, we'll each claim our own retirement benefits.
What about you?
Just because claiming at 70 might be the best move for me doesn't mean it's right for you. You have to make your own decision based on your life expectancy and financial situation. Personal preference comes into play, too. If you hope to retire at 62 and can only do so with the help of Social Security, you might prefer to claim early, regardless of whether it shrinks your lifetime benefit.
Think about what makes sense for you right now and build your retirement plan around that. But be prepared to adapt your plan as needed. If your health or finances take a turn for the worse or the government changes how Social Security benefits work, you might want to revisit your claiming strategy.
