Is It Better to Start Social Security at Age 62 or 70? Statistics Give a Clear Answer.

Choosing an age to claim Social Security is an important financial decision with lifelong consequences. Retired workers are eligible for benefits at age 62, but delaying Social Security increases the payout by a predetermined percentage each month through age 70.

Put differently, retired workers who start Social Security at age 62 maximize the number of payments, but they are penalized with the most severe benefit reduction. Retirees who start Social Security at age 70 are rewarded with the most robust benefit increase, but they receive the minimum number of payments.

The stakes are particularly high because Social Security is often the largest source of income in retirement. Of course, the best age to start benefits varies based on individual circumstances. But if maximizing lifetime benefit income is the goal, statistics give a clear answer regarding the best age to claim Social Security.

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Claiming age plays a key role in determining Social Security benefits for retired workers

Social Security benefits for retired workers are calculated based on three variables: Birth year, lifetime income, and claiming age.

• Birth year: Your birth date determines your full retirement age (FRA). Workers who claim Social Security at FRA receive 100% of their primary insurance amount (PIA).
• Lifetime income: The benefits formula is applied to the inflation-adjusted earnings from your 35 highest-paid years to determine your PIA.
• Claiming age: Your PIA is adjusted for early or delayed retirement. Workers who claim Social Security before FRA receive less than 100% of their PIA. Workers who claim Social Security after FRA receive more than 100% of their PIA.

The chart below details the relationship between birth year and full retirement age. It also shows the benefit (as a percentage of the PIA) retired workers will receive if they start Social Security at ages 62 and 70. In other words, the chart shows the smallest and largest possible benefit for retired workers based on birth year.

Data source: Social Security Administration..

As shown above, retirees can substantially boost their benefit by delaying Social Security. For instance, beneficiaries born in 1960 or later can increase their monthly check by 77% by claiming Social Security at age 70 rather than age 62.

Most retired workers can maximize lifetime benefits by claiming Social Security at age 70

Last year, more than one-quarter of newly retired workers started Social Security at age 62, and more than half incurred a penalty for collecting Social Security before full retirement age. Those people may have shortchanged themselves hundreds of thousands of dollars in some cases.

A study published in 2022 by the National Bureau of Economic Research ("How Much Lifetime Social Security Benefits Are Americans Leaving on the Table?") found that over 90% of workers aged 45 to 62 will optimize lifetime benefit income by claiming Social Security at age 70. But current behavior suggests the vast majority will start Social Security much earlier, such that the median loss in lifetime benefit income will total $225,944.

Admittedly, there are situations where it makes sense to claim Social Security before age 70. But financial experts at JPMorgan Chase recommend that individuals ask themselves the following questions before making any decisions.

• Are you currently working? If the answer is yes, consider delaying Social Security until you stop working. That is especially true for anyone subject to the retirement earnings test, which stipulates that some benefits be withheld when Social Security recipients under full retirement age have income above the annual limits.
• Do you have other sources of income? If the answer is yes, and the additional sources of income support a comfortable lifestyle, consider delaying Social Security to earn a bigger benefit. Over 80% of adults have supplemental sources of retirement income like investment accounts, bank accounts, and pensions, according to the Nationwide Retirement Institute.
• Do you expect to live beyond age 77? If the answer is yes, consider delaying Social Security. For workers born in 1960, the break-even age is 78 when comparing claims at age 62 versus full retirement age. In other words, workers with a lifespan of at least 78 years (but no more than 81 years) will maximize their lifetime benefits by claiming Social Security at full retirement age.
• Do you expect to live beyond age 81? If the answer is yes, consider delaying Social Security. For workers born in 1960, the break-even age is 82 when comparing claims at full retirement age versus age 70. In other words, workers with a lifespan of at least 82 years will maximize their lifetime benefits by claiming Social Security at age 70.

With that in mind, the probability is 67% that a 62-year-old male will live at least 77 years, and the probability is 53% that he will live at least 81 years, according to JPMorgan Asset Management. Those statistics suggest that more than half of 62-year-old males will maximize their lifetime benefits by claiming Social Security at age 70.

Similarly, the probability is 77% that a 62-year-old female will live at least 77 years, and the probability is 66% that she will live at least 81 years, according to JPMorgan Asset Management. Those statistics suggest that two-thirds of 62-year-old females will maximize their lifetime benefits by claiming Social Security at age 70.

Here's the bottom line: Statistically speaking, the average 62-year-old male and female will maximize their lifetime benefits by claiming Social Security at age 70. But very few people will maximize lifetime benefits if they start Social Security at age 62.

Individuals nearing retirement should be particularly mindful of those facts if they are in good health. It is arguably more important for beneficiaries with longer-than-average lifespans to claim Social Security at age 70. Alternatively, those who anticipate a shorter-than-average lifespan should consider claiming Social Security at an earlier age.