Is Waiting to Claim Social Security Always the Best Move? 15 Things to Consider

The longer you delay claiming your Social Security benefits, the larger your monthly checks will be -- at least until you reach age 70. That's because, by waiting, you can minimize or avoid early filing penalties applicable prior to your full retirement age (FRA) and you can maximize delayed retirement credits that boost benefits after FRA.

But just because you can get larger monthly benefits by putting off filing for Social Security doesn't mean it makes sense for every senior to wait.

To help you make the right choice, consider your answers to these 15 key questions.

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The first step to developing a Social Security strategy is to decide on your retirement goals.

If your hope is to leave the workforce as soon as humanely possible, it may not make sense to put off claiming Social Security. You'd have to fund many years of retirement solely from savings, which can be a huge challenge. If early retirement is a major priority, you may prefer to start getting benefits ASAP to make that happen even if it means each Social Security check will be smaller.

On the other hand, you may want to work for as long as you can -- even into your 70s. If so, waiting would likely be a good bet. You may not need your Social Security if you're getting a paycheck, so there'd be little downside to delaying.

And if you were earning too much before full retirement age, you could end up temporarily forfeiting some or all of your benefits if you claimed them early.

ALSO READ: Your Guide to Working While on Social Security

For some retirees, Social Security makes up a huge portion of their retirement income because they don't have a lot of savings to supplement it. For others, Social Security is just a pittance because they have plenty of money in the bank.

If Social Security is going to be one of your absolute most important retirement income sources, it probably pays to try to max out your benefits by waiting as long as you can to start them.

Social Security benefits alone are rarely enough to fund an entire retirement. If you're anticipating you can claim your benefits and afford to retire without savings, you're going to be disappointed.

Sign into your Social Security account to get a realistic idea of what income Social Security will provide you. If it turns out that it's too little to live on -- and it probably will be -- it may make sense to put off claiming benefits and try to keep working a little longer.

By delaying your retirement, you can boost your Social Security income and you'll also have more time to work and add cash to your retirement savings accounts.

Before deciding whether to wait to claim benefits, make sure you understand how early filing penalties and delayed retirement credits actually work.

See, if you start your checks prior to FRA, an early filing penalty applies for each month. The individual penalty is small -- a fraction of a percent -- but the cumulative effects are substantial. For each of the first three years you claim early, you'll see a 6.7% annual reduction in your standard benefit. And you'll lose an additional 5% for each prior year before that.

Delayed retirement credits do the opposite. For each month of delay after FRA, there's a small increase in your monthly check. Collectively, delayed retirement credits can raise your standard benefit by 8% per year of waiting.

Once you understand the trade-offs and how your decision affects your benefits, you can make a more informed choice about whether waiting to claim is the smartest move.

The $17,166 Social Security bonus most retirees completely overlook
If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known "Social Security secrets" could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $17,166 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies.

A delay in claiming Social Security makes your monthly payments bigger -- but obviously it also means missing out on getting checks you'd be entitled to if you'd filed for benefits earlier.

You have to make up for those missed checks before you break even. That can take a long time. You can calculate your break-even point by figuring out how much money you'll miss out on and dividing that number by the extra money in your checks that resulted from the delay.

ALSO READ: How Your Social Security Break-Even Age Affects When You Should Claim Benefits

You'll need income once you have left the workforce. If you delay claiming your Social Security benefits, more of that money will have to come from your savings.

Unfortunately, this could mean you end up spending your nest egg too quickly to try to sustain your lifestyle without Social Security. Spending down your account and leaving yourself with too little invested to earn reasonable returns could leave you in dire straits.

You'd be far better off not waiting to claim Social Security in order to preserve your savings.

Generally, in order to end up better off by waiting to claim benefits, you'll need to outlive your projected life span. That's because Social Security is theoretically designed for retirees to get the same lifetime benefits regardless of when they first file for them.

If you have serious health issues, it's possible you won't live long enough to break even, much less end up with more money over time. If that's likely to happen to you, you'd be smart to err on the side of starting benefits early.

Your family's health history can also give you some clues to your longevity -- and thus whether you'll hit your break-even point if you delay claiming Social Security.

While no one can predict exactly when they will pass away, if everyone in your family lived into their 90s, then odds are in your favor that you'll also live a very long life. If you take after your ancestors, you'd end up with a lot of extra Social Security money if you wait to claim benefits.

If your spouse needs to claim benefits on your work history, they can't do that until you've started getting your checks. Waiting may not pay off in this situation, since you may want to file ASAP to unlock these additional benefits.

If you earned more than your partner, it could pay to wait to claim benefits. That's because starting your checks early would mean shrinking survivor benefits that your spouse would receive if you passed away.

Widows and widowers often struggle to make ends meet. You may not want to make things any harder for your spouse by getting your benefits early and reducing the money he or she will receive later.

The $17,166 Social Security bonus most retirees completely overlook
If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known "Social Security secrets" could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $17,166 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies.

If you're claiming spousal benefits, it can pay to delay until full retirement age in order to avoid early filing penalties. But it doesn't make sense to wait beyond FRA because you aren't eligible to earn delayed retirement credits on spousal benefits.

In other words, waiting until 70 wouldn't result in a higher spousal benefit and you'd miss out on years of checks for no reason.

ALSO READ: Claiming Social Security at 62? 3 Things You Need to Know

For some retirees, the goal is to get the largest possible monthly Social Security check. And many financial experts advise maxing out these benefits because they are often the only guaranteed source of lifetime income.

If that's your objective, then wait to start getting your checks, because each month of delay will make them a little bigger.

If you are primarily concerned with getting the most lifetime benefits, then odds are delaying your claim for Social Security would be the right move.

Studies have shown around six in 10 retirees end up with more if they delay their benefits claim. This happens, in part, because life expectancies have gotten longer since the Social Security system was designed -- so more people end up outliving the life expectancy that the benefit formula was based on.

If you wait to claim Social Security benefits, there's a chance health issues will have developed later in life that affect your ability to enjoy the money.

If you're not well enough to travel or indulge your hobbies, you may not care very much about having extra cash. Instead, you may have been better off with smaller checks that came when you could still use the funds for your retirement dreams.

If you're worried about having too little money in the later years of your retirement, waiting to start your Social Security checks is a better choice.

That's because these benefits are guaranteed to last for life. Getting the largest checks possible could give you the money you need when your savings is running short and your healthcare costs are likely mounting.

The $17,166 Social Security bonus most retirees completely overlook
If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known "Social Security secrets" could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $17,166 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies.

As you can see, waiting to claim benefits isn't the right choice for everyone. By considering your financial situation and retirement goals, you can make the best decision about whether a delay in filing for benefits makes sense for you.

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