It's important to maximize your Social Security benefits if you want to be as financially secure as possible in retirement. Doing so requires thinking carefully about exactly when you'll start claiming your benefits, because the wrong choice can be a costly mistake that can last the rest of your life. The longer you go without Social Security early on, the greater the monthly payments will be when you do choose to start getting them.
There's plenty of analysis that can help you figure out what your own personal ideal age for claiming Social Security might be. Yet for many people, the experience of their elders is a helpful learning tool. Thanks to the new 2018 Retirement Confidence Survey from the Employee Benefit Research Institute, you can see when current retirees decided to start taking their benefits and how it compares with your own ideas about Social Security.
When most people claim Social Security
By far the most popular age at which current retirees started getting monthly Social Security payments was when they turned 62. About 34% of those surveyed picked age 62 for their start date.
That's not surprising, because 62 is the earliest age at which most people can claim regular retirement or spousal Social Security benefits. There are only limited situations in which retirees can get benefits sooner, the most common being survivor benefits based on a deceased spouse's work history, which most survivors can claim as early as age 60.
By claiming at age 62, retirees were willing to take a substantially lower monthly payment. For those whose full retirement age was 65, the reduction amounted to 20% of what they would have gotten had they waited three extra years. More recent retirees with full retirement ages of 66 have seen typical reductions of 25% by claiming early, while for those in the future, the cut will rise to 30% because of the boost in full retirement age to 67.
Yet the trends are moving away from early claiming. The 2018 figure was down 6 percentage points from 2017's number of 40% for claimers at 62. That suggests that more people see the benefit of waiting a bit longer before taking their Social Security.
The big surprise at No. 2
Based on the tendency for people to take their benefits as early as possible, you might think that 63 would be the next most popular age for Social Security retirees. Yet even when you combine 63- and 64-year-olds claiming, they add up to just 9% of those surveyed.
Instead, the survey showed that retirees have more patience than you might think. Age 65 was the second-most popular choice. About 22% of retirees surveyed in 2018 took their Social Security when they were 65, up from 19% of those surveyed last year.
For generations, 65 has been the socially accepted age at which people chose to retire. Lawmakers and the Social Security Administration have sought to change that general idea, raising the full retirement age in part to encourage longer careers. But even though recent retirees have to take a modest reduction in their monthly payments when they choose to retire at 65, it hasn't stopped them from doing so. By contrast, only 16% of retirees first took their benefits between 66 and 69, and just 5% waited to max out their monthly payments at 70.
Waiting longer to boost your Social Security
Apart from the most popular ages for claiming, the big takeaway from the EBRI survey was that retirees have gradually waited slightly longer before taking Social Security, with the biggest percentage reduction applying to those taking benefits at their first opportunity at 62. Waiting as long as possible isn't always the best answer, but in general, being able to hold off on Social Security a bit longer can raise the amount of desirable guaranteed income that you can rely on lasting throughout your retired years.