When should you claim your Social Security benefits? That's a tough question to answer, as you can do so at any time between ages 62 and 70, but the longer you wait, the the larger your monthly benefit checks will be.
That fact makes some people want to delay claiming Social Security as long as possible, but there are several good reasons waiting may not be the best choice. We asked our team of Motley Fool contributors to share a few reasons you'd be better off claiming your benefits sooner rather than later.
Selena Maranjian: One reason to not wait until age 70 to start collecting your Social Security checks is that though your checks will be bigger, you may still not be coming out ahead. That's because, as the Social Security Administration (SSA) itself has explained, "If you live to the average life expectancy for someone your age, you'll receive about the same amount in lifetime benefits. It doesn't matter if you choose to start receiving benefits at age 62, full retirement age, age 70, or any age between." That might not appear to make sense, until you remember that if your normal retirement age (per the SSA) is 67 and you wait until 70 to start collecting, you'll be missing out on receiving checks for those three years. You'll forgo receiving 36 smaller checks, which will add up to a significant sum.
A key factor in the SSA's explanation, though, is that it's based on averages. If you live to an average life expectancy, there won't be much overall difference in the total benefits you collect if you start at age 62, 67, or 70. If you're likely to live significantly longer or less long than average, it's a different story.
Everyone's situation is different, so read up on the topic. There are gobs of different strategies regarding when to start collecting -- especially if you're married. You might even want to consult a financial advisor. A hasty decision can lead to far fewer total benefits received.
Brian Feroldi: One reason you might want to claim Social Security sooner rather than later is that there's a good chance the program may face some changes making it tougher to claim at an early age.
Each year, the Social Security Administration issues a report on its current and projected financial status, and while the latest projections show that the program has enough to fund itself until 2034, there may be reason to believe that the program could undergo some changes well before then.
Here's a choice quote, directly from the Social Security Administration: "Social Security as a whole as well as Medicare cannot sustain projected long-run program costs under currently scheduled financing. Lawmakers should take action sooner rather than later to address these structural shortfalls."
While that sounds like a worrisome statement, any changes are likely to be gradual to minimize disruption to the system. Still, given the state of the government's finances, our political leaders may choose to make changes down the road, so it might make sense to claim benefits sooner rather than later to avoid the chance of a potentially negative impact.
Brian Stoffel: As Selena has already pointed out, the differences in payouts are constructed such that lifetime benefits are on average the same no matter when you decide to file for Social Security. Knowing that, I believe you need to have a compelling reason to wait until 70 to claim benefits -- just having a bigger payout alone might not make the most sense.
This is especially true for those who have significant health problems, or a family history of such maladies. While on the one hand you want to be able to pay for medical expenses with a bigger Social Security check, you also want to enjoy your time with loved ones as much as you can. That's one of the biggest reasons people look forward to retirement.
You can start claiming Medicare benefits at 65. All other things being equal -- which they never are, but for such a broad audience, let's suspend reality a bit to get the bigger point -- it makes much more sense to start claiming Social Security earlier and focusing on what's really important to you.
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