Millions of seniors count on Social Security to pay the bills in retirement, and thankfully, signing up for benefits is pretty easy. But if you're wondering whether that process will happen automatically, the answer is "no."
The reason? There's no single age to file for Social Security. Eligible recipients get an eight-year window to claim benefits that begins at age 62 and ends at age 70. (In fact, you're not even required to file by 70, though there's no financial reason to wait past that point.) There are different repercussions and advantages associated with filing at various ages, so the decision to claim benefits isn't one the Social Security Administration (SSA) can make for you. Rather, you'll need to weigh the pros and cons of filing at various ages to land on the right one.
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Making the best filing decision
Your Social Security benefits are calculated based on your 35 highest years of earnings, but the age at which you file for them can cause that number to climb or drop. If you file at full retirement age (FRA) -- which is 67 for anyone born in 1960 or later – you'll get the exact monthly benefit your earnings record entitles you to. File before FRA, and your benefits will be reduced for each month you claim them early. And if you delay benefits past FRA, you'll boost them by 8% a year up until age 70 -- which is why waiting past 70 doesn't pay: You won't grow your benefits any longer.
Because there are financial ramifications involved in your filing decision, you'll need to consider your choices carefully. One thing to keep in mind is the extent to which you expect to rely on Social Security to cover your expenses in retirement. If you've saved well, you might claim benefits on the early side so you can use them to travel or enjoy life while you're relatively young. But if you're low on savings, you'll probably want to grow those benefits, or least avoid a reduction.
Your health should play a big role in your filing decision, too. Though Social Security is technically designed to pay you the same lifetime total regardless of when you initially file (the logic being that claiming early will reduce your payments, but you'll get more of them, while filing late will increase your payments, but you'll get fewer), that's only the case if you live an average lifespan. If your health is poor, and you expect to pass away on the younger side, you're generally best off claiming benefits as soon as you're able to. And if you expect to live a longer life than most, you should file as late as possible.
Claiming your benefits
No matter when you decide to file for Social Security, don't expect those benefits to become available overnight. It can take several months for your application to go through, so if, for example, you want to start collecting benefits at age 67, you'd be wise to apply when you're 66 and 9 months old.
The easiest way to apply for Social Security is online via the SSA's website. You can also apply by phone or in person at your local Social Security office, though you might need an appointment if you're going the latter route. Either way, put a decent amount of thought into the decision, and thank your lucky stars that you have the flexibility to start taking benefits at a time that's most optimal for you.
