Social Security is likely to be a critical part of your retirement, and it has played a major part in older Americans' financial lives for a long time. Consider these words from the Social Security Administration, from 2016: "If today's seniors had to rely on only their income from sources other than Social Security, fully 4 in 10 would be poor. Social Security is our nation's most effective poverty prevention program; its retirement, disability, and survivor benefits keep 21 million Americans out of poverty, including 14 million seniors."

If you're wondering how and when to start collecting your benefits, read on -- for a thorough review of just what Social Security is, how to get the most out of it, and how to apply for it.

Top half of form on clipboard that says social security application form

Image source: Getty Images.

Step 1: Understand what Social Security is

Let's start with a little history. President Franklin Roosevelt signed the Social Security Act into law on Aug. 14, 1935. As early as 1929, months before the big crash on Wall Street that preceded the Great Depression, Roosevelt stated: "No greater tragedy exists in modern civilization than the aged, worn-out worker who after a life of ceaseless effort and useful productivity must look forward for his declining years to a poorhouse. A modern social consciousness demands a more humane and efficient arrangement."

Over the years, Social Security has become the biggest source of income for most older Americans. About nine out of 10 folks 65 and older receive benefits, and it makes up about 33% of their income, on average. Among single retirees, 69% get more than half their income from Social Security. For a sobering 21% of married retirees and 44% of single ones, Social Security checks make up at least 90% of their income. In 2018, some 63 million Americans will receive roughly $1 trillion in Social Security benefits.

Some view Social Security benefits as a freebie from the government, but they're forgetting that most paychecks in America have 6.2% of pay withheld for Social Security tax -- with employers chipping in another 6.2%, for a total of 14.4% of our pay going toward Social Security. Those funds from people who are currently working are used to provide benefits for those collecting retirement benefits -- people who have paid into the system previously.

Step 2: Find out your full retirement age

One of the first things you need to know in regard to Social Security -- and before you apply for your benefits -- is what your "full retirement age" is. That's the age at which you're entitled to start receiving your full Social Security benefits. That age used to be 65, but for most of us these days, it's 66 or 67 or somewhere in between. The table below will help you pinpoint your full retirement age:

Birth Year

Full Retirement Age

1937 or earlier



65 and 2 months


65 and 4 months


65 and 6 months


65 and 8 months


65 and 10 months




66 and 2 months


66 and 4 months


66 and 6 months


66 and 8 months


66 and 10 months

1960 and later


Data source: Social Security Administration. 

It's important to know your full retirement age because it's likely to play an important part in your Social Security strategizing.

Step 3: Find out how much income you can expect

Next, you should figure out how much income your benefits are likely to provide you in retirement. This is important no matter how old you are now. Even if you're just 39 right now, knowing how much you can expect in retirement can help you see how much additional income you'll need to provide for yourself on your own and figure out how much you need to sock away over the coming decades.

The formula used by the Social Security Administration to calculate your ultimate benefits is a bit complicated. In a nutshell, here's how it works: It collects your earnings for every year that you worked and adjusts them for inflation. Then it takes the 35 highest-earning years and averages them, dividing by 420 (because there are 420 months in 35 years) in order to reach your "average indexed monthly earnings" (AIME). It then applies its formula to the AIME, arriving at your "primary insurance amount" (PIA). That's the benefit you're entitled to at your full retirement age.

For 2018, the formula is 90% of the first $895 in your AIME (that's $805.50), 32% of the amount of AIME greater than $895, up to $5,397 (that's $1,440.64 for those with AIMEs of at least $5,397), and 15% of the amount of AIME greater than $5,397. You can see, therefore, that someone with an AIME of $5,397 would get a benefit that's the total of $805.50 and $1,440.64 -- $2,246.14. That's much more than most people will get, though, as $5,397 per month is what someone earning nearly $65,000 annually would get, and that's a higher-than-average wage.

The average Social Security retirement benefit was recently $1,415 per month, or about $17,000 per year. Those with above-average earnings will get bigger checks, however (and vice versa). The recent maximum monthly Social Security benefit for those retiring at their full retirement age was recently $2,788. (That's about $33,500 for the whole year.)

You can find out what you can expect to receive from Social Security by setting up a my Social Security account with the Social Security Administration. Doing so will not only let you see estimates of your future benefits based on records of your earnings in past years, but you can also take care of other business there. For example, you can change your address, review the SSA's record of your past earnings to make sure they're correct, check the status of your application for benefits, request a replacement Social Security card (if you meet certain criteria), request a replacement Medicare card, start or change the direct depositing of your benefit payments, and get a replacement SSA-1099 or SSA-1042S form for tax purposes -- among other things. Setting up an account is smart thing to do -- in part because if you do so before an identity thief does so in your name, it can prevent a lot of headaches. 

A colorful gauge labeled benefits, pointing to the word maximum

Image source: Getty Images.

Step 4: Learn how you can increase your benefits

Once you have a good idea of how big your benefit checks are likely to be in retirement, know that you may be able to make them significantly bigger -- or you can at least collect a lot more from Social Security than you otherwise would have.

Among the many ways to increase your Social Security benefits, a particularly powerful strategy is simply to delay starting to collect them. All of us can start collecting our benefits as early as age 62 and as late as age 70. For every year beyond your full retirement age that you delay starting to receive benefits, you'll increase their value by about 8% -- until age 70. So delaying from age 67 to 70 can leave you with checks about 24% fatter -- enough to turn a $2,000 check into a $2,480 one. Of course, if you start collecting early, your benefit checks will be smaller -- but don't dismiss the possibility of collecting early. Starting early means your checks will be smaller, but you'll get many more of them. For many people, if not most, it can actually be best to start collecting at age 62.

The table below gives you a rough idea of the effect of waiting to start collecting your benefits or of starting early. It shows the approximate percentage of your full Social Security benefits that you'll get if you start collecting at various ages. So if your full retirement age is 67 and you start collecting at, say, age 64, you'll receive 80% of the amount you'd have gotten if you started at 67.

Start Collecting at:

Full Retirement Age of 66 

Full Retirement Age of 67 




























Data source: Social Security Administration. 

Here are some other ways to boost your benefits:

  • Work at least 35 years. The formula used to compute your benefits is based on your earnings in the 35 years in which you earned the most money (adjusted for inflation). If you only earned income in 30 years, the formula will be incorporating five zeros, which doesn't plump up your benefits.
  • Aim to have as many high-earning years as possible. If you're currently earning much more than you have in the past (on an inflation-adjusted basis), even if you've already worked 35 years, you might consider working for another year or two, as each high-earning year will kick a low-earning year out of the calculation, beefing up your benefits. Remember -- it's your 35 highest-earning incomes that are used in the calculation.
  • Fix any mistakes in your earnings record. It can also be worth examining the SSA's record of your income and taxes paid into the Social Security system to make sure it's correct. If it's not, you might end up receiving smaller benefit checks than you've actually earned. Simply correcting an error might increase your benefits. You can check the record of your earnings when you set up a my Social Security account at the website.
  • Delay your divorce. This strategy will only work for those who are divorcing and only for those who can delay the divorce. It's based on the rule that a divorcee can collect benefits based on an ex-spouse's earning history (even if the ex has remarried), if that spouse earned more in their working life. You need to follow the rules, though. For example, you have to have been married for at least 10 years, which is why you might need to delay. There are a few more rules related to this, which you can learn on the Social Security website.

Step 5: Think about whether you'll be working while collecting benefits

If you plan to still be working a little in retirement, you may need to crunch a few more numbers. That's because if your income passes a certain level while you're receiving Social Security benefits, those benefits may end up taxed. You will never be taxed on more than 85% of your Social Security benefits, but you could be taxed on up to 50% or 85% of them. If Social Security benefits make up all or the vast majority of your income, you likely won't be taxed on them at all.

To determine whether you'll have to pay taxes on Social Security benefits, you need to calculate your "combined" income, which is your adjusted gross income ("AGI") plus non-taxable interest plus half of your Social Security benefits. The table below shows the taxation you can expect:

Filing as

Combined Income

Percentage of Benefits Taxable

Single individual

Between $25,000 and $34,000

Up to 50%

Married, Filing Jointly

Between $32,000 and $44,000

Up to 50%

Single individual

More Than $34,000

Up to 85%

Married, Filing Jointly

More Than $44,000

Up to 85%

Data source: Social Security Administration. 

Notice the words "up to" in the table above. They're there because the rules aren't simple. As my colleague Matt Frankel has explained: "The formula to figure out how much of your Social Security income may be taxable is rather complicated, and you can see an example of it on page seven of IRS Publication 915. Or, better yet, if you have information about your other income, you can use a Social Security tax calculator to calculate this amount." He offers a handy calculator in his article on the topic. 

Meanwhile, if you're working while receiving Social Security benefits, you may also have some of your benefit dollars withheld. Benefits get reduced if you earn more than a certain sum while collecting benefits before your full retirement age. The Social Security Administration explains: "If you're younger than full retirement age during all of 2018, we must deduct $1 from your benefits for each $2 you earn above $17,040." The money withheld isn't lost, though. It's factored into the benefit checks you receive later, which end up increased.

Once you reach your full retirement age, though, you can collect Social Security benefits and can earn any amount of money, and your benefits won't be reduced.

A red rubber stamp that says important

Image source: Getty Images.

Step 6: Formulate your Social Security strategy

Now that you're armed with all this background information, if you're suddenly itching to apply for your Social Security benefits, hold off just a little more. You still need to consider a range of options and decide what strategy will work best for you.

You need to decide when the best time is for you to start collecting. If you're not married, you can ignore spousal strategies and just think about what's best for you alone. It's often best to start collecting as soon as possible, in part because few of us know how long we'll live. The system is actually designed so that if you live an average-length life, it will be a wash whether you start collecting early or late. So if you stand a good chance of living a near-average-length life, starting early makes plenty of sense and you can end up collecting more, overall, from the program even with your smaller checks, than if you'd delayed and started collecting later.

If you have a bunch of relatives who have lived well into their 90s, though, and you're in good health and able to delay starting to collect benefits, it can be worth doing so. Your checks will be larger, and you'll stand a good chance of receiving enough of them to make the delay well worth it.

If you're married, there are some Social Security strategies for couples to consider. For example, you and your spouse might start collecting the benefits of the spouse with the lower lifetime earnings record on time or early, while delaying starting to collect the benefits of the higher-earning spouse. That way, you'll both enjoy some income earlier, and when the higher earner hits 70, they can start collecting extra-large checks. Also, should that higher-earning spouse die first, the spouse with the smaller earnings history can collect those bigger benefit checks as their own.

It's not a bad idea to go over Social Security strategies and your overall retirement plan with a professional advisor, if you're not confident that you have a good plan and are on track to retire well. Advisors designated as fee-only won't be looking to earn commissions from selling you products, and you can seek one at

Step 7: Apply for Social Security benefits

Guess what? You're now ready to apply for your Social Security benefits. It's recommended that you apply a few months before you want your benefit checks to start arriving. If you want to start collecting them at age 62, you can apply when you're 61 years and nine months old.

When you approach the age at which you want to start collecting those checks, there are three ways that you can apply for your benefits:

  • In person: To apply in person, just visit your nearest Social Security office. The SSA offers a tool to help you locate the nearest office. For maximum convenience, it's best to call first and make an appointment.
  • Over the phone: To apply over the phone, call 800-772-1213.
  • Online: To apply online, click over to the Social Security website.

The SSA describes the online process like this:

Social Security offers an online retirement application that you can complete in as little as 15 minutes... In most cases, once your application is submitted electronically, you're done. There are no forms to sign and usually no documentation is required. Social Security will process your application and contact you if any further information is needed.

Before you actually apply for your benefits, it's helpful to know more about what to expect of the process and what you should be ready to do.

What you'll need when you apply for Social Security

Regardless of how you apply, you'll need to be prepared to provide various documents or information from them. The SSA advises that it might ask for:

  • Your original birth certificate, a certified copy of it, or some other proof of your birth
  • Proof of your U.S. citizenship or your status as a legal alien
  • A copy of your U.S. military service paper(s) if you served in the military before 1968. (A DD-214-Certificate of Release or Discharge from Active Duty form would be good here.)
  • A copy of your W-2 form(s) and/or your tax return for last year if you were self-employed

Those are the main items you may need, but the SSA also lists other information that you should be able to offer:

  • Your birth date, place of birth, and Social Security number. (If you've ever used another Social Security number, be sure to inform the SSA, too.)
  • The name, birth date, and Social Security number of your spouse, if you have one, as well as any former spouses. For each of your marriages, you should be able to provide the wedding date and location, and dates of divorce or death, if either happened.
  • The names of any unmarried children you have who are younger than 18; 18 or 19 and in secondary school; or who are disabled since before they turned 22.
  • Whether you have ever applied for Social Security benefits, Medicare, or Supplemental Security Income (SSI) before -- or whether anyone has done so on your behalf. If any of these were done based on someone else's Social Security record, the SSA will need details on that.

You'll also need to specify when you want your Social Security benefits to start being paid to you -- and, if you're within three months of turning 65, whether you want to enroll in Part B of Medicare. This is important: If you're not receiving Social Security benefits and are still working and not ready to retire, don't fully ignore the online application process -- because of Medicare. Whether you want your retirement benefits anytime soon or not, you should still sign up for just Medicare three months before your 65th birthday. There's a costly penalty if you enroll late.

Finally, you'll need to furnish the routing number of your bank or financial institution where you'd like your Social Security payments direct-deposited and your account number there.

If you're worried that you won't be able to gather all this information that you may need to supply, don't be discouraged. Go ahead and apply, even if you're missing a few bits of information. The Social Security Administration may be able to help you out by tracking down some of the info.

How to apply for Social Security online

Here's a little more detail on the online application process, which you can begin at this "Apply for Retirement Benefits" page: You'll be asked to answer questions about yourself, your family, and your work, among other things. You won't have to start and finish it all in one session. The system allows you to stop at various points, save what you've entered so far, and return to the application later. That can be especially helpful if you need to find some required information to enter. You can even go back and make changes or fix errors until you save the application for the last time and click the "Submit Now" button.

As you go through the application form online, it will tell you what information it needs and what documents you will need to provide.  You can mail it in, per the instructions -- or, if you prefer, you can take them to a Social Security office, in person. You'll "sign" the application electronically, with the push of a button. Once you're done, you'll get a receipt with a confirmation number. That will permit you to check on the status of your application online later.

Be sure that you're filling out the form on a secure online network, to prevent any snooping or attempts at identity theft or fraud. You don't want to be entering Social Security numbers and other important personal information over an open network in a hotel or coffee shop, for example. How can you tell if you're on a secure network? Well, if you're using your home network that requires a password, you should be fairly safe. (It's all the better if you employ some security software, too, that includes a firewall and guards against malware, viruses, and the like.) If you're using a network somewhere else, it should be a secure one (often designated by a symbol of a lock) that requires you to use a password given to you there. Better still, use a Virtual Private Network (VPN) to boost your security further. For maximum security, avoid public networks, at least for finance-related purposes.

Why apply for Social Security benefits online?

Applying for Social Security online makes a lot of sense for most of us. You can avoid a trip to the local Social Security office and it allows for completing the process at times of your choosing. The Social Security Administration estimates that the process should take most people between about 10 and 30 minutes to complete.

The SSA offers some more reasons why you might want to apply online, noting that:

  • "You will have a chance to correct mistakes. You can go back and make changes until you finish the application. You'll also be given a chance to review your answers and go back and make corrections before you submit the application."
  • You don't need to mail the application, which can save you some postage as well as a trip to the post office. (You'll likely have to mail in some supporting documents, though.)
  • You will have the reassurance that your application went through because you'll get a receipt for it, which you can print and keep.
  • You'll be able to follow the status of your application online, using the confirmation number provided in your receipt.

After you apply...

Once you apply for your Social Security benefits, the SSA will review your application and they'll contact you if they need further information or documents. You may also be informed that you can receive benefits based on someone else's earnings record -- such as a former spouse -- and the SSA will alert you if they determine that any other family members can receive benefits based on your earnings record.

Once all the needed information is in the system, the SSA will process your application and will send you a letter with its decision about it, which is likely to confirm the commencement of your benefits.

If you've worked for at least 10 or so years, you can probably look forward to at least some retirement income from Social Security, though it won't be as much as it is for those who worked 35 or more years. Whatever sum you're due, though, is yours to collect. You just have to apply for it!