Look, I get it. You’ve worked your entire life, paid into Social Security, and now you’re staring at one of the biggest financial decisions you’ll ever make. When should you actually start taking your benefits?

Everyone’s got an opinion. Your neighbor swears by taking it at 62 (“Get it while you can!”). Your financial advisor keeps talking about waiting until 70. And your spouse? Well, they’re probably just as confused as you are.

Here’s the thing – there’s no magic answer that works for everyone. But there are some facts you absolutely need to know before you make this choice. Because once you start collecting, there’s pretty much no going back. Understanding the current Social Security payment schedule can also help you plan your finances better.

I’ve been helping people navigate this decision for years, and I’m going to walk you through everything you need to consider. No complicated jargon, no confusing charts – just straight talk about what each option really means for your wallet and your future.

First Things First – How Does This Whole Thing Actually Work?

Before we dive into the age debate, you need to understand how Social Security figures out your benefit in the first place. It’s not as mysterious as they make it sound.

The government looks at your 35 highest-earning years (adjusted for inflation, so your 1985 wages count more than the actual dollars you made). They run these numbers through their formula and – boom – that’s your “Primary Insurance Amount” or PIA. Think of it as your baseline benefit.

Now, here’s where it gets interesting. Your PIA is what you get if you claim at your “full retirement age.” For most people reading this, that’s somewhere between 66 and 67, depending on when you were born.

But here’s what they don’t always make clear: you don’t have to wait until your full retirement age to start collecting. You can start as early as 62. You can also wait as late as 70. Each choice comes with trade-offs that’ll affect you for the rest of your life.

The earlier you claim, the smaller your monthly check. The later you claim, the bigger it gets. Sounds simple, right? Well, not exactly…

Taking Social Security at 62: The Good, Bad, and Ugly

Let’s start with the earliest option. At 62, you can walk into the Social Security office (or go online) and start getting checks. Lots of people do exactly that.

Why People Love the Idea of Taking It at 62

You Get Money Right Now – This one’s obvious, but it’s huge. Maybe you lost your job. Maybe your health isn’t great. Maybe you’re just tired of working and want to enjoy life while you can. Social Security at 62 means immediate cash flow, and sometimes that’s exactly what you need.

I had a client – let’s call him Bob – who got laid off at 61. He looked for work for months but couldn’t find anything that paid decent wages. Taking Social Security at 62 wasn’t his ideal plan, but it kept the lights on and food on the table.

Your Investment Accounts Get a Break – Here’s something most people don’t think about. Every dollar you get from Social Security is a dollar you don’t have to pull out of your 401(k) or IRA. If you’ve got retirement savings, starting Social Security early might actually let those accounts grow for a few more years.

Think about it this way: would you rather take reduced Social Security and let your investments ride, or drain your savings while waiting for a bigger Social Security check? Sometimes option one makes more sense, especially if the stock market’s doing well.

What if You Don’t Live That Long? Nobody wants to think about this, but it’s real. If you’ve got health problems or just don’t expect to live to 85 or 90, taking benefits early might get you more total money over your lifetime. The “break-even” point where waiting pays off is usually somewhere in your early 80s.

But Here’s What They Don’t Tell You About Taking It at 62

Your Check Is Permanently Smaller – When I say smaller, I mean significantly smaller. If your full retirement age is 67 and you claim at 62, you’re looking at about 70% of what you could have gotten. That’s a 30% haircut on every single check for the rest of your life.

Let’s say your full benefit would be $2,500 a month. Claim at 62, and you’re getting $1,750. That $750 difference every month adds up to $9,000 a year, $90,000 over ten years. You get the picture.

You Might Be Leaving Money on the Table – Here’s something that surprised me when I first learned it. Your Social Security benefit is based on your 35 highest-earning years. If you’re 62 and still working, you might be in some of your peak earning years right now.

Every year of high earnings that replaces a lower-earning year in your calculation increases your eventual benefit. So by claiming at 62, you might be giving up not just the early claiming penalty, but also missing out on years that could boost your baseline benefit.

The Earnings Test Can Be Brutal – Want to keep working after you claim at 62? Better watch out for this trap. In 2024, if you earn more than about $22,320, Social Security starts taking back benefits. For every $2 over that limit, they keep $1 of your Social Security.

So if you’re earning $30,000 and your Social Security is $1,750 a month, you’d lose about $3,800 in benefits for the year. It’s like a hidden tax that nobody warns you about.

Your Spouse Gets Hurt Too – If you’re married and you’re the higher earner, your claiming decision affects your spouse even after you’re gone. When you die, your spouse gets 100% of whatever benefit you were receiving – not what you could have received.

So if you claimed early and got that reduced $1,750 instead of the full $2,500, your surviving spouse is stuck with the smaller amount for the rest of their life.

Taking Social Security at 67: Playing It Safe

Your full retirement age – probably 67 if you were born after 1960 – represents the middle ground. It’s not the earliest you can claim, and it’s not the latest that makes sense.

Why Full Retirement Age Makes Sense

You Get Your Full Benefit – At 67, you get 100% of your Primary Insurance Amount. No penalties, no reductions. It’s exactly what the system calculated you’ve earned based on your lifetime work record.

Social Security Is Tax-Smart – Here’s something that makes Social Security more valuable than you might realize. Most states don’t tax it at all. And even the federal government only taxes up to 85% of your benefit, meaning at least 15% is always tax-free.

Compare that to pulling money out of your traditional 401(k), where every dollar counts as taxable income. Social Security dollars stretch further than regular retirement account dollars.

It’s a Reasonable Compromise – You’re not sacrificing the benefit amount like you would at 62, but you’re also not gambling on living long enough to make waiting until 70 worthwhile. For a lot of people, this feels like the “Goldilocks” option – not too early, not too late.

The Downside of the Middle Road

You’re Still Missing Out on Growth – Every year you wait past 67 gets you an 8% increase in your benefit. That’s guaranteed growth you can’t get anywhere else these days. With interest rates and CD rates where they are, that 8% annual increase looks pretty attractive.

No Early Cash Flow – Unlike claiming at 62, waiting until 67 means you’re giving up five years of potential Social Security income. If you retire before 67, you’ll need to fund those years entirely from savings or other sources.

Taking Social Security at 70: Going for Maximum Monthly Income

Waiting until 70 is the “maximize your monthly benefit” strategy. By then, you’ve earned every delayed retirement credit the system offers.

Why Waiting Until 70 Can Be Smart

Your Checks Are as Big as They’ll Ever Get – At 70, you’re getting 124% of your Primary Insurance Amount if your full retirement age is 67. Using our earlier example, instead of $2,500 at 67, you’d get $3,100 at 70. That extra $600 a month might not sound like much, but over 20 years it’s an extra $144,000.

Tax Planning Gets Interesting – Without Social Security income in your 60s, you might find yourself in lower tax brackets. This could be the perfect time to convert some of your traditional IRA money to a Roth IRA at lower tax rates. You pay taxes now but set yourself up for tax-free income later.

You’re Protecting Your Spouse – If you’re married, maximizing your benefit means maximizing your spouse’s eventual survivor benefit. This strategy can be incredibly valuable for couples where one spouse has significantly higher Social Security benefits.

But Waiting Until 70 Isn’t Perfect Either

That’s a Lot of Delayed Gratification – We’re talking about potentially giving up eight years of Social Security benefits (from 62 to 70) to get those higher monthly payments. You need either steady work income or substantial savings to make this work.

You’re Betting on Your Longevity – The math on waiting until 70 generally works out if you live into your early 80s or beyond. But what if you don’t? What if health problems crop up in your 70s? You could end up receiving less total money over your lifetime.

Your Savings Take a Hit – If you retire before 70 but delay Social Security, you’re funding your entire lifestyle from other sources. That means drawing down 401(k)s and IRAs, leaving less money to generate income for the rest of your retirement.

The Stuff That Really Matters (But Nobody Talks About)

Your Health Reality Check

Be honest with yourself about your health. I’m not talking about being a pessimist, but if you’ve got serious health issues or a strong family history of certain conditions, that should influence your decision. The Social Security Administration provides detailed information about planning for retirement at different ages that can help you consider health factors in your decision.

My aunt waited until 70 to claim Social Security because the math looked good. She died at 72. She got two years of higher benefits instead of potentially eight years of lower benefits. The math didn’t work out for her family.

On the flip side, I know plenty of people who expected to die “early” and are still going strong in their 90s.

Marriage Changes Everything

If you’re married, this isn’t just about you. You need to think about both spouses’ benefits, health situations, and what happens when one of you passes away. How remarriage after 60 affects your Social Security benefits is another important consideration for many seniors.

Sometimes the optimal strategy is for one spouse to claim early while the other delays. Sometimes it makes sense for both to wait. AARP’s guide to Social Security claiming strategies for couples provides detailed scenarios for different situations.

Your Money Situation Matters More Than You Think

How much other retirement income do you have? If Social Security is going to be your primary source of retirement income, claiming early might be financial suicide. If you’ve got substantial savings and pensions, you might have more flexibility.

Think about your expenses too. Can you live comfortably on the reduced benefit from early claiming? Or do you need maximum income to maintain your lifestyle?

Making Your Decision: A Real-World Approach

Here’s how to think through this decision without getting lost in the weeds:

Step 1: Get Your Numbers – You can create ‘my Social Security account’ online to see your actual numbers. This isn’t hypothetical – these are your actual numbers.

Step 2: Look at Your Complete Picture – What other income sources will you have in retirement? How much do you need to live comfortably? Can you afford to delay Social Security, and what would it cost you?

Step 3: Consider Your Health Honestly – Are you likely to live to average life expectancy or beyond? Any major health concerns in your family or your medical history?

Step 4: Factor in Your Spouse – If you’re married, how do both of your Social Security benefits work together? What’s the impact on survivor benefits?

Step 5: Trust Your Gut – After you’ve run all the numbers and considered all the factors, what feels right? Sometimes peace of mind is worth more than optimizing every last dollar.

The Bottom Line

There’s no universal “right” answer to when you should take Social Security. The best choice depends on your health, your finances, your family situation, and honestly, your personality.

What I can tell you is this: whatever you decide, make sure it’s an informed decision. Don’t just take it at 62 because you’re worried the system will go broke. Don’t wait until 70 just because someone told you that maximizes your benefit. Look at your own situation and make the choice that makes sense for your life.

And remember – while you generally can’t change your mind once you start benefits, you can make a decision you’ll feel good about if you take the time to understand your options.

Your Social Security benefits represent decades of your working life. Make sure you’re making the most of them in a way that fits your needs and gives you peace of mind in retirement.

The “perfect” claiming age doesn’t exist, but the right claiming age for you absolutely does. Take the time to figure out what that is. For additional strategies on optimizing your benefits, check out these smart ways to boost your Social Security retirement check.