The Best Reason to Take Social Security Long Before Age 70

Here's a question you may not have spent much time mulling over: When should you start collecting your Social Security benefits? It's a more important question than you might realize, because the answer will determine, to a meaningful degree, the size of your checks.

There's a solid case to be made to wait until you're 70 years old, but there's also a darn fine reason to start much earlier.

Image source: Getty Images.

When to start collecting Social Security

First, each of us has a "full retirement age" at which we can start collecting the full benefits to which we're entitled, based on our earnings history. For most workers these days, and for everyone born in 1960 or later, it's 67.

You can start collecting retirement benefits as early as age 62, though. Doing so will mean shrunken checks -- but many more of them. Alternatively, you can delay beyond your full retirement age. For each year you delay, up to age 70, your benefits will increase by about 8%. (Of course, simply starting at your full retirement age is also an option.)

Check out the table below, which shows how much of your full benefits you'll collect based on your full retirement age and when you start collecting:

Source: Social Security Administration.

Why you might delay starting to collect Social Security

Why delay? Well, look at the table: You can turn a $2,000 monthly benefit into a $2,480 one by delaying until age 70. That would take you from $24,000 on an annual basis to nearly $30,000. That alone is not enough to help you decide, though. Think about your health and your expected longevity.

If you stand a decent chance of living a shorter-than-average life, delaying might leave you with less in total benefits received than if you started earlier. Much depends on your break-even age -- the age at which you will have collected about the same amount in total from Social Security via many smaller checks or fewer larger ones. That age is roughly age 80.

If you might well live a long life and you can manage to delay claiming Social Security until age 70, definitely consider doing so. Not only will you end up with fatter checks, but each (mostly annual) cost-of-living adjustment, or COLA, will be greater, too. Also, be sure to strategize with your spouse, if you're married, to come up with the best joint strategy.

Why you might start collecting Social Security early

Here's the best reason why you might want to claim your benefits early: You should do so if you simply really need that income as soon as possible. Many people will find themselves in such a situation, and the typical age at which people claim their benefits is 62 or 63.

Consider that a 2023 Edward Jones study found that fully 40% of financial advisors said they had clients who had retired early, and not because they wanted to. A 2023 study by Allianz Life found that more than half of retired Americans were forced into an early retirement -- for a reason such as illness or a job loss.

Those who have saved aggressively and invested effectively may be able to retire early and still delay Social Security, but few people are in that camp. Check out how much workers in America have socked away for retirement, per the 2023 Retirement Confidence Survey:

Source: 2023 Retirement Confidence Survey.
*excluding the value of a primary home

Give the question of when to start receiving your Social Security checks careful thought. Know that the average monthly Social Security retirement benefit was $1,845, as of November 2023, totaling about $22,000 per year. Fortunately, there are ways to increase your Social Security benefits -- some of which you might act on even if retirement is decades away.