You can sign up for Social Security as soon as you turn 62, but you may have heard that signing up that early can permanently shrink your checks. If that concerns you, you might consider delaying benefits until a later age, like 65.
But whether that's a smart decision for you depends on your personal goals, finances, and life expectancy. Here's a look at when it's a good idea and when it's not.
Times have changed
For decades after Social Security's inception, 65 was considered full retirement age (FRA). That's when you become eligible for your full Social Security benefit based on your work history. Starting earlier than this shrunk your checks, while delaying benefits past this age increased them until you reached the maximum benefit at 70.
But as people lived longer, the government changed the definition of FRA. For those born in 1943 and later, FRA falls somewhere between 66 and 67. That means that claiming at 65 is now technically considered claiming early.
Signing up then will shrink your checks, but it won't have the same effect that starting at 62 would. When you sign up at 62, you only get 70% of your full benefit per check if your FRA is 67 or 75% if your FRA is 66. But if you sign up at 65, you get 86.7% of your full benefit per check if your FRA is 67 or 93.3% if your FRA is 66.
So if you qualify for the average $1,661 monthly check at 67, you'd only get about $1,163 per check if you signed up right away at 62. But you'd get $1,440 per month by delaying until 65. That's a difference of $277 per month just for waiting three years.
So is starting Social Security at 65 a smart move?
Ultimately, you should choose when to sign up for Social Security based on your life expectancy and financial situation.
Signing up right away at 62 could be the right choice if you need your Social Security checks to help cover your bills or if you don't believe you'll live long.
But those who expect to live into their 80s or beyond often get the most out of the program by delaying benefits if they can afford to do so. Some even choose to delay until they qualify for their maximum monthly benefit at 70. This is 124% of your full benefit per check if your FRA is 67 or 132% if your FRA is 66.
The catch is, you don't know exactly how long you'll live. So figuring out the ideal time to sign up for Social Security isn't all that straightforward. If you're concerned about possibly shortchanging yourself by signing up too early or too late, 65 could be a good compromise. Or you could just wait until your FRA.
Explore a few different options until you find a claiming age that works for you. If you need some help, use the benefit calculator in your my Social Security account to figure out what kind of benefit you'll qualify for at any age.
Social Security's place in your retirement plan
There is no "right" time to claim Social Security. What's most important is that you understand how Social Security fits into your overall retirement plan so you know how much you have to personally save.
Once you've chosen a claiming age and you know approximately how much of your monthly retirement costs it will cover, you can begin to figure out how much you need to save on your own. With that savings target in mind, you can begin paving the way toward a comfortable retirement.