When Should You Take Social Security?

There are many opinions out there on what age to start taking Social Security. But when to take Social Security is a decision that’s much more nuanced and impactful.

There are pros and cons of taking Social Security at a variety of ages, and we will focus on three key ages here: age 62, Full Retirement Age, and age 70.

Age 62

Typically, this is the earliest you can claim Social Security. An advantage here is early cash flow—you get access to your benefits sooner, which can provide immediate financial flexibility. This is beneficial if you need the income to cover expenses, retire early, or if you have health concerns that might reduce your life expectancy. Quality of life is a big concern as well. If your body is already aching at 62, 70 is not likely to feel much better. Maybe you take the cashflow early in order to enjoy trips abroad in the “younger” years of your retirement.

It is important to remember that there’s no “free lunch”, however. A trade-off is that your monthly benefit will be reduced, often by as much as about 30% compared to waiting until your full retirement age. This reduction is permanent, so your monthly Social Security benefit will be lower for the rest of your life.

Full Retirement Age

Full Retirement Age (or FRA), which for most people is between 66 and 67, is a common reference point for deciding when to start Social Security. Claiming at this age means you will receive your full, unreduced Social Security benefit. This option strikes a balance—providing a decent monthly income without the penalties of claiming early. It is a solid choice if you can wait and do not need the funds immediately.

Age 70

Finally, there is the option of deferring Social Security all the way to age 70. If you wait until 70, your monthly benefit increases by about 8% per year beyond your FRA. This means a larger monthly check, which can be a game-changer if you expect to live a long life and want to increase your

Social Security income. However, the downside is that you may need to fund your retirement entirely from other sources until you turn 70.

Which Age Is for You?

Each option has its own set of advantages and trade-offs. Taking benefits early gives you immediate cash flow but reduces your monthly income from social security for life. Waiting until FRA or even 70 can increase your monthly benefits but requires other income sources in the meantime, possibly reducing your retirement accounts’ ability to grow or affecting the legacy you wish to leave behind.

Keep in mind that Social Security is only one part of the retirement picture. The goal is to incorporate Social Security benefits as part of your overall planning, budget and cash flow. The decision for you can only be made after taking a holistic look at your retirement income sources and assets.

Social Security can also become more complicated with factors such as marriage, divorce, widowhood, or disability for you or your dependent.

This is just scratching the surface of a complex decision. The decision for you is based on your unique life and circumstance. At Voyage Financial Group, we can help you evaluate your situation and help you choose a Social Security strategy for you.

If you are unsure of when to start taking Social Security or want a tailored financial plan, please reach out to us today. We are here to help you make good life decisions for your financial future. We can help make sure that current you is taking care of future you.