The Pros and Cons of Taking Social Security at 9 Different Ages

Chances are that, when you retire, you’ll be reliant on Social Security income in some capacity to make ends meet. Data from the Social Security Administration (SSA) finds that 62% of today’s retired workers lean on the program for at least half of their income. Meanwhile, a 2018 Gallup survey found that 84% of nonretirees expect to need Social Security income in some capacity during retirement.

This data reaffirms that maximizing what you’ll receive from the program over your lifetime is of great importance -- and there’s no variable that can have a bigger impact on what you’ll eventually receive than your claiming decision.

The SSA will take four primary factors into account when calculating your retirement benefit. The first two -- your earnings history and work history -- are inextricably linked. Your 35 highest-earning, inflation-adjusted years are used when determining your benefit.

The third factor, which you have no control over, is your full retirement age, as determined by your birth year. Your full retirement age is the age at which you become eligible to claim your retired worker benefit and receive 100% of your monthly payout. For most everyone, it’s either age 66 (for those born between 1943 and 1954), 67 (for people born in 1960 or later), or somewhere in between 66 and 67 (for folks born between 1955 and 1959).

The fourth and final factor, and the one that can impact your monthly payout by as much as 76% (all other factors being equal), is your claiming age. Although you can begin taking retired worker benefits at age 62, for each year you hold off on your claim, your payout grows by about 8%, up until age 70.

Of course, there are pros and cons about each claiming age between 62 and 70. Today, we’ll take a closer look at what you can expect from each of these nine different claiming ages, as well as what group of people might benefit from an early, mid, or late claim.