When should you claim Social Security?
Social Security retirement benefits can be claimed any month from age 62 to 70. Full Retirement Age (FRA) is 67 for anyone born in 1960 or later. Claiming at 62 permanently reduces your benefit by about 30% versus FRA. Claiming every year past FRA boosts the benefit by 8% per year, up to age 70, after which there’s no further increase. The break-even point between claiming at 62 vs 70 is typically around age 80 to 82, live past that and waiting was the better call.
Your FRA benefit at 67 is $3,000 a month. Claim at 62 and you get ~$2,100. Claim at 70 and you get ~$3,720. Over a 20-year retirement starting at 62, the early claimer collects ~$504,000. The age-70 claimer collects ~$892,800 starting later but at a higher rate. By roughly age 82, the late-claimer is ahead in cumulative dollars and stays ahead for every month of additional lifespan.
Claiming at 62 because ‘the government will go broke’. Even under the Trustees’ pessimistic projections, the program can pay roughly 79% to 83% of scheduled benefits past 2033 from ongoing payroll tax. Locking in a permanent 30% cut to hedge a partial cut isn’t risk management; it’s the loss already.
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