Choosing when to begin taking Social Security is not a decision to be taken lightly, as it will affect your monthly income for the rest of your life.
Age 62 is the most popular time to file, with around 35% of men and nearly 40% of women claiming at this age, according to a 2020 report from the Bipartisan Policy Center. However, filing at 62 will also drastically slash your benefits by up to 30%.
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Delaying until age 70 will result in much larger checks each month, but it's not easy waiting several more years for Social Security -- and in some cases, it could actually hurt your lifetime benefit amount.
So which is the best age to start claiming? There's no one-size-fits-all answer, but it may be a little easier to decide by asking yourself this one important question: What's your biggest priority in retirement?
If your main priority is maximizing your monthly income
For many retirees, Social Security is a lifeline in retirement. The median retirement account balance as of 2022 is just $35,345, according to a report from Vanguard, and Social Security can potentially make or break retirement for many older adults.
In this case, waiting as long as possible to take benefits can make an enormous impact on your overall retirement. By delaying until age 70, you'll collect your full benefit amount plus at least 24% extra each month for the rest of your life.
This could potentially amount to several hundred dollars per month. For example, say you have a full retirement age of 67 years old, and by filing at that age, you'd receive $1,800 per month (which is roughly the average benefit amount among retirees as of September 2023).
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If you were to file at 62, your benefits would be permanently reduced by 30%, leaving you with $1,260 per month. But by waiting until age 70, you'd receive your full $1,800 per month plus an extra 24%, or $2,232 per month. That's a whopping $972 more per month than you'd collect at age 62.
Research also suggests that age 70 is the financially best move for most adults. In 2019, researchers at United Income studied retirees' claiming choices and how those decisions affected their lifetime benefit amount.
They found that 57% of retirees could have earned more over a lifetime by waiting until age 70 to claim. They also revealed that the average retired household misses out on around $111,000 in total lifetime income by claiming at the sub-optimal age.
If your main priority is retiring early
Waiting until age 70 may be the best move financially, but there's more to this decision than simply dollars and cents.
If you're eager to get a jump-start on your retirement, claiming at 62 can sometimes be a smart idea. You don't have to start taking benefits as soon as you retire. But if you retire in your early 60s and delay benefits, you'll need to rely on other sources of income for several years -- which risks draining your savings too quickly.
Of course, you will receive smaller checks by claiming early. But if your main priority is retiring early and you're willing to make financial sacrifices (or you have a robust retirement fund and don't necessarily need the extra cash), it may be worth it.
Also, in some cases, claiming early can actually be a smart financial move. While it's not the most pleasant topic to think about, your overall health and life expectancy can help you decide when to file.
If you have reason to believe you may not live well into your 80s or beyond, you may actually collect more over a lifetime by claiming early. Each check will still be smaller, but you'll receive more of them in total than if you'd delayed benefits.
Which is the best decision for you?
There's not necessarily a right or wrong time to take Social Security, as it will depend on your unique situation.
Financially, it often makes the most sense to delay until 70, as that will maximize your monthly income. But finances are only one part of the equation. If you're OK with receiving less per month if it means you can spend more time in retirement, claiming early may be your best bet.
Regardless of what you decide, be sure you've considered the pros and cons of all of your choices. The more thought you put into this decision, the better your chances of enjoying the best possible retirement.
