Once you reach the age of 62, you're allowed to sign up for Social Security at any point in time. However, you should know that you're not entitled to your full monthly benefit -- the one that's calculated based on your personal wage history -- until full retirement age, or FRA, arrives.
FRA depends on your year of birth. If you were born in 1960 or later, it's 67. Otherwise, it's either 66 or 66 plus a certain number of months.
You can also delay your Social Security claim past FRA for a boosted monthly benefit. For each year you hold off, up until age 70, your monthly paychecks will grow 8%. That's a nice increase to snag on a lifetime basis.
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In fact, you may have heard that delaying Social Security pretty much always makes sense, since you're guaranteed higher monthly benefits perpetually. But delaying your claim isn't automatically a savvy move. And if these three scenarios apply to you, then you may be better off not delaying Social Security, and instead filing at FRA or even sooner.
1. Your health isn't so great
A higher monthly Social Security benefit might seem appealing, and delaying your claim could be your ticket to snagging it. But if your health is poor and you don't end up living very long, you might deny yourself some lifetime Social Security income by pursuing a higher benefit on a monthly basis.
Let's say that at your FRA of 67, you're in line for $1,800 a month from Social Security. If you were to delay your claim until age 70, that $1,800 would increase to $2,232.
But you'll need to live until age 82 1/2 to break even with your delayed claim -- to collect the same lifetime Social Security benefit you'd get by filing at 67. So, if you're not sure your health will allow you to live until 82 1/2, you're better off not delaying Social Security.
2. Your job is harming your health
Some people experience on-the-job stress from time to time, and that's not really abnormal. But if your job is causing you constant stress, to the point where it's harming your health, then you may want to call it quits for the sake of your physical and mental well-being.
But claiming Social Security may be the only way to get by in the absence of a paycheck from work. In this scenario, though, it may be worth it to forgo a higher monthly benefit and put your health first.
3. You no longer have a job
Getting laid off later in life can constitute a major blow. In addition to the loss of your paycheck, you might struggle to find work elsewhere due to your age. You may also have a hard time finding a new job if you've been with the same employer for many years and don't have many contacts outside of the company that's letting you go.
In that situation, you may want to claim Social Security sooner rather than delay your filing. Doing so could help you avoid racking up debt to pay your expenses. It might also help you avoid going to extreme measures, like taking out a reverse mortgage to drum up income.
For some people, delaying Social Security absolutely makes sense. But if these circumstances apply to you, you may want to file for Social Security at FRA -- or even before, despite a lifelong reduction in your monthly benefits.
