Millions of seniors today rely heavily on Social Security to pay the bills in retirement, and a large chunk of current workers no doubt intend to do the same. But new data from the Employee Benefit Research Institute tells us that 50% of non-retired adults are in danger of not getting the most out of their benefits down the road. Why? Because they haven't considered how the age at which they first claim Social Security will impact how much they ultimately collect.

If you're expecting to depend significantly on Social Security in retirement, then you'll want to be strategic about when you file for your benefits. Otherwise, you might be setting yourself up for extra financial struggles.

Social Security card


When it comes to Social Security, age matters

Though your Social Security benefits are calculated based on how much you made during your highest-earning 35 years of work, the age at which you first file for them can cause the size of your checks to go up or go down. This is because the calculus is also based on what the government defines as your full retirement age (FRA). Claim your benefits at your FRA, and you'll get the "full" monthly benefit amount you're entitled to, based on your salary history.

Full retirement age is based on your year of birth, as follows:

Year of Birth

Full Retirement Age




66 and 2 months


66 and 4 months


66 and 6 months


66 and 8 months


66 and 10 months

1960 or later



That said, you're allowed to claim benefits as early as age 62 -- an option close to half of Americans rush to take (though the percentages have been falling since the mid-1990s). But filing ahead of your FRA will cause your your monthly benefits to drop.

How much money do you stand to lose? Let's imagine you're entitled to $1,400 a month, which is roughly what the average recipient today collects. If your full retirement age is 67 but you file at 62, you'll shrink each monthly payment by 30% to just $980.

Of course, you don't have to pull the trigger on benefits upon reaching full retirement age, either. If you hold off on Social Security past FRA, you'll snag an 8% boost in benefits for each year you delay, up until age 70, at which point you might as well go ahead and file even if you're still working -- there's nothing to be gained from waiting longer. So if your full monthly benefit at 67 is $1,400, waiting to file until 70 lifts your monthly payments to $1,736, and you'll collect that extra $336 each month for the rest of your life.

Claiming your benefits carefully

Clearly, the way to get the most money each month out of Social Security is to wait until you turn 70 to start taking benefits. But that's not necessarily the way to get the most in total benefits, nor is it the right move for everyone.

If you lose your job prior to age 70, or prior to FRA, it may make sense to apply for Social Security benefits immediately, especially if the alternative is racking up debt because you don't have the savings or investment income to cover your living expenses. The same holds true if you're hit with a large unplanned expense and don't have the money to pay for it. Taking on debt later in life increases your chances of carrying it with you to the grave, so if filing for benefits sooner helps you avoid that fate, so be it.

Another good reason to file for Social Security earlier rather than later? If your health is poor, or reasons such as your family history lead you to expect you're not destined for a long life, then you're generally best off taking benefits as soon as possible. See, Social Security is actually designed to pay you about the same total amount in lifetime benefits, regardless of when you initially file. On the one hand, if you file ahead of your FRA, you reduce the size of your monthly payments, but you'll collect more of them. On the flip side, if you hold off on filing for benefits past your FRA, you'll get fewer payments, but those checks will be larger.

This formula, however, assumes that you will live an average lifespan -- to about 78 1/2. If you pass away earlier than that, waiting means collecting a smaller total. Going back to our example, let's say you're entitled to a full monthly benefit of $1,400 at an FRA of 67.

Filing at 62 will leave you with close to the same total lifetime benefit if you live until roughly 78 1/2. But if you pass away at 76, you'll have foregone more than $13,000 in Social Security income by not taking benefits as early as possible. But if you live into your 80s or 90s, the larger monthly checks you gain by postponing have longer to stack up, and build you a greater lifetime total. Therefore, you need to factor your health into the decision about when to file, as well as your age.

It's in your best interest to maximize your Social Security benefits, and that means being smart about when you claim them. Though there's no such thing as one universally "right" age to take benefits, being clear about the implications of filing at various points during your eight-year window of 62 through 70 will help you do just that.