When should I claim Social Security benefits? That's one of the most important questions Americans will have to answer as they approach retirement age.
The most popular age for claiming Social Security is 62, the earliest age for which benefits can be received. However, the full retirement age for anyone born in 1960 or later is 67. If you're weighing your options about claiming at 62 or 67, there are several things you should know.
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Three key questions
One of the most important questions to answer when deciding whether to claim Social Security at age 62 or age 67 is whether you can retire comfortably without collecting Social Security benefits. If the answer is no, you will either need to claim benefits at 62 or hold off on retiring.
You could continue working part-time (or even full-time) while receiving Social Security retirement benefits to help supplement your income. Keep in mind, though, that the Social Security Administration (SSA) will withhold $1 in benefits for every $2 you make above a specified limit ($23,400 in 2025) if you're under your full retirement age for the entire year. SSA will withhold $1 in benefits for every $3 you make above a higher limit ($62,160 in 2025) if you work during the year you reach your full retirement age.
Two other key questions to answer relate to your health.
First, are you healthy enough to continue working past age 62? If not, claiming Social Security at the earliest age possible could make sense. Note, though, that you should verify your eligibility for Social Security disability benefits before filing for retirement benefits.
Second, do you have health problems (or a family history of health problems) that lead you to believe you won't live a long time after retiring? If so, claiming at 62 might be a smart choice. The explanation for this brings us to our next topic: financial trade-offs associated with claiming Social Security at 62 versus 67.
Financial trade-offs
If everyone received the same monthly benefit at age 62 as they would at 67, even more people would claim Social Security early. However, that's not the case. SSA will reduce your benefits by five-ninths of 1% for each month you collect retirement benefits before your full retirement age, up to 36 months. If you claim more than 36 months before your full retirement age, your benefit will be reduced by five-twelfths of 1% per month.
How much does this early retirement penalty impact you if you claim Social Security at 62? Your monthly benefit will be a whopping 30% lower than if you waited until 67 to claim Social Security.
That's a steep financial trade-off. But on the positive side, you begin receiving benefits from Social Security sooner when you claim at 62.
The break-even age, where lifetime benefits from claiming at 62 equal the lifetime benefits from claiming at 67, is between 78 and 79 years old. If you don't expect to live past this break-even age, your cumulative lifetime benefit could be higher by claiming Social Security earlier. On the other hand, if you expect to live longer, holding off on claiming Social Security could be financially advantageous.
The problem, of course, is that no one knows how long they'll live. However, a study published by the National Bureau of Economic Research (NBER) in 2022 found that more than 90% of Americans who had not begun receiving Social Security benefits would maximize their lifetime benefits by waiting until age 70 to claim benefits.
No one-size-fits-all answer
What is the best age to claim Social Security retirement benefits? SSA is frequently asked this question. The agency's response is a good one: "The answer is that there's not a single 'best age' for everyone and, ultimately, it's your choice. The most important thing is to make an informed decision."
The bottom line is that there's no one-size-fits-all answer. For some, claiming benefits at 62 is the smartest move. For others, waiting until 67 (or even 70) is preferable. Only you can make the right decision for you.
