When Should You Take Social Security?


An individual who pays into social security for 40 quarters is eligible to receive retirement benefits between the ages of 62 and 70. The big question is when is the right time to start receiving those benefits? That is a difficult question to answer because everybody’s situation is unique. Regardless, we hope to provide you with some beneficial information to help you make an informed decision.

To start, an individual must input the year they were born into the retirement age calculator on the Social Security website. This tool will generate a “full retirement age” for you. Please note, this is an optimal retirement age determined by Social Security and it will likely be different than your age at actual retirement.

The full retirement age that is provided to you by Social Security is when you would receive 100% of your retirement benefits. However, an individual can choose to receive their benefits sooner. If they decide to take them sooner, they receive less money. Likewise, an individual can receive more money if they choose to delay their benefits. Benefits cannot be received before age 62 or delayed past age 70. Let’s look at an example to illustrate this a little better.  

Let’s say you were born in 1956. After inputting 1956 into the retirement age calculator tool, Social Security determines your “full retirement age” is 66 and 4 months. The benefit promised by Social Security based on your “full retirement age” is $1300 a month.  If you decide to take Social Security now, since you are currently 62, you are accelerating benefits and would only receive $953 per month. Delaying benefits and waiting until age until 70 raises your payment to $1681 per month.


Now let’s look at the effect of when to take benefits based on your lifestyle.  For example, if you need $5000 per month to maintain your current lifestyle, how does delaying your benefit from Social Security until 70 compare to accelerating your benefits at age 62?  Well, as you can see below, the green bars represent how much you would need to generate from a separate retirement portfolio to fulfill your lifestyle needs. By delaying your Social Security benefit until 70, and receiving $1681 a month, instead of $953 today, you could withdraw 15% less from your retirement portfolio. Taking Social Security at “full retirement age” (66), and receiving $1300 per month instead of $953 at 62, this retiree can withdraw 7% less from their retirement portfolio.


Now, we are not advising you to wait until 70 to take your benefits.  Our goal is to make you aware of the differences in benefit amounts throughout the Social Security age range.  You can see how much your “full retirement age” benefit amount is reduced or increased by utilizing this tool on the Social Security website. Understanding your financial needs and income sources is a key first step in planning for retirement. Knowing what part Social Security plays in providing retirement income is critical. This tool can be very useful. 

Information was obtained by The United States Social Security Administration and is considered accurate, but not guaranteed. For illustration purposes only. Each individual situation is different. Please contact a Social Security representative for professional guidance or assistance. 

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