Ready to live the dream and collect the Social Security retirement benefit you've earned? Of course you are. But there's one small task to complete first. Answer six questions to confirm that now's the time to file your Social Security application.

1. What is your full retirement age?

Your full retirement age (FRA) is the age you qualify for your full Social Security benefit. You may have heard the estimate that Social Security replaces about 40% of your working income. You should know that this replacement rate only applies at FRA. Claim earlier and your benefit will be lower.

You can find your FRA on mailed Social Security statements or in your my Social Security account online.

Two seniors sitting on ground outdoors and laughing.

Image source: Getty Images.

2. What are your monthly living expenses in retirement?

You don't really know if now's the right time to collect Social Security until you understand the cost of your lifestyle in retirement. It's possible that your total income in retirement right now won't fund your lifestyle. And the easiest way to address that problem is to hold off on collecting your retirement benefits.

The good news is, your living expenses are likely to go down once you retire. Big expenses that drop off are retirement contributions and payroll taxes. These can be offset somewhat by higher healthcare and recreational expenses.

3. How much income will you get from other sources?

To get a complete picture of your retirement finances, you must estimate income from pensions, annuities, and savings.

Pensions and annuities are straightforward, since they often pay a set amount. Estimating your income from savings is slightly more complicated. If your savings are in a tax-advantaged retirement account, like a 401(k), you can estimate annual income at 4% of your balance. At that distribution rate, your savings should last for several decades.

Remember, too, that you will pay income taxes on 401(k) and IRA distributions. Be sure that's accounted for in your budget.

4. What is your estimated benefit if you claim now?

Find your estimated Social Security benefit on mailed Social Security statements or online in your Social Security account. Add the estimate to your other income sources and compare the total to your living expenses.

If your total retirement income doesn't balance with the cost of your lifestyle, you have options. You can downsize or keep working part-time. You can also hold off on Social Security to collect a higher benefit later. But before you make any big decisions, answer the next question below.

5. Is your work record complete?

Social Security uses your work history to calculate your benefit. If some of your work history is inaccurate or missing, your benefit could be artificially low.

Check your mailed Social Security statement or your online record at the my Social Security site for accuracy. To correct omissions and mistakes, gather up your documentation and call your Social Security office.

6. How would your benefit change if you waited?

Your benefit will rise if you delay your application. You can estimate the increase by logging into your my Social Security account.

Delaying your benefits comes with a trade-off, though. You forgo income now in return for higher income later. This can be a good deal or a bad one.

Holding out for a higher benefit makes more sense when you're in good health, you have the option to keep working, and you expect to live deep into your senior years. Waiting to collect is less appealing if you're in poor health or you need the income now.

Retire with confidence

Collecting Social Security is a major financial milestone. It's best to head into this new phase of life with full knowledge of your budget and your options.

While you can "undo" your Social Security application by withdrawing or pausing your benefits, it may be harder to undo related life decisions -- like leaving your job or moving into a retirement community.

Take the time now to confirm your decision. That'll free up more time and brainpower to explore and enjoy your new lifestyle.