One of the biggest decisions you'll make in retirement is when to claim Social Security. Claiming early gives you more years to collect a monthly benefit. Waiting until later means you'll eventually receive a bigger check every month.
While common personal finance advice is to wait as long as possible to claim Social Security benefits, few retirees wait till age 70, when your monthly benefits max out. In many cases, those early claimers are justified in their decision, especially as dual-income households face a much less cut-and-dried decision.
Looking at what other people decide may help you make a better decision about what's best for your situation. Here are the most popular claiming ages for retirement benefits, based on the most recent data from the Social Security Administration.
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1. Age 62
You first become eligible to receive Social Security benefits at age 62, and roughly 23% of men and 24.5% of women decide to claim ASAP. That makes it the most popular age at which to claim benefits.
There are several good reasons to claim benefits as early as you can. If you need the supplemental income to make ends meet in retirement, you'll certainly be better off than if you try to wait. If you have health concerns that could cut your life short, claiming early is a perfectly rational decision. And in some instances, it makes sense for a low-earning spouse to claim benefits as early as 62 to maximize expected lifetime household income.
Of course, the downside of claiming at age 62 is a smaller benefit. The average person who claimed at age 62 in 2022 received $1,287.61 per month. After the cost-of-living adjustment for last year and this year, that's the equivalent of $1,444.42.
2. Full retirement age
If you want to receive your full retirement benefit, you have to wait until your full retirement age. In 2022, 15% of men and 13.4% of women waited until full retirement age to claim their retirement benefits. Many more saw their disability benefit convert to a retirement benefit upon reaching full retirement age.
2022 saw some retirees reach full retirement age at 66 and 2 months, but others had to wait until 66 and 4 months. That's because Congress changed the law in 1983 to gradually increase the full retirement age to 67. Those born between 1943 and 1954 reached full retirement age at 66. The full retirement age increases by 2 months for each year you were born after 1954, until it reaches age 67 for anyone born in 1960 or later.
There are several good reasons to claim benefits once you reach full retirement age. As mentioned, it's the age you receive your full benefit, striking a good middle ground between claiming early and waiting until age 70. It's also the age where you'll max out your spousal or survivor benefit, making it pointless to wait any longer. Even if you're not yet eligible for a spousal benefit, it might make sense to claim your own benefit at full retirement age before switching to your spousal benefit later.
The average benefit for those who waited until full retirement age is significantly higher than those claiming at 62. Retirees claiming at age 66 (not necessarily full retirement age) in 2022 received an average of $2,241.66 per month. After adjusting for the last two COLAs, that's the equivalent of $2,514.66.
3. Age 65
65 is often cited as the normal retirement age for Americans, because it was the age at which you'd receive your full retirement benefit when Social Security began. It's also the age you become eligible for Medicare, the federal health insurance program for seniors. Since the Social Security Administration will deduct your Medicare premiums from your monthly retirement benefit automatically, some retirees may find it advantageous to apply for benefits at the same time they apply for Medicare, often at age 65.
13.3% of men and 13.4% of women applied for Social Security between the age of 65 and their full retirement age in 2022. That makes it the third most popular age overall.
As mentioned, there's not much significance to age 65 other than the fact that you become eligible for Medicare at that age. That may make it easier for some seniors to quit their jobs and the employer-sponsored health insurance that often comes with them.
Many people will apply for Social Security benefits as soon as they quit work, even if it's before full retirement age. That could backfire, however, as you may be subject to the retirement earnings test during the first year you start collecting benefits. That will reduce your benefit if you earn above a certain threshold in a given year. So, if you quit mid-year, you may receive a much smaller than expected benefit, or you may end up owing money at the end of the year due to your earnings.
The average 65-year-old claiming Social Security for the first time in 2022 received $1,874.56 per month. Adjusted for the last two COLAs, they receive the equivalent of $2,102.85.
When should you claim Social Security?
The best age for you to claim Social Security retirement benefits will depend on your personal situation. For the average individual with no spouse (or ex-spouse), it's hard to argue against waiting until age 70 if you can afford to do so.
Waiting that long will maximize your monthly benefit. What's more, waiting to claim will also protect your personal savings if you end up living longer than expected, ensuring that you can afford retirement in your old age.
But only 8.6% of men and 9.5% of women waited until 70 or older to claim benefits in 2022. That number is climbing, however, as anyone born in 1943 or later can increase their benefit by 8% per year for waiting until age 70. Just 1.4% of men and 2.2% of women waited until 70 or older in 2012. If you can afford it, it's certainly worth considering joining the growing group of seniors waiting to claim benefits.
