We all know that Social Security is a significant source of retirement income for tens of millions of Americans.
What fewer people know is that Social Security benefits can vary a lot from one person to the next, because the size of those benefits hinges on several factors—among them, age.
Age 70 is a particularly noteworthy age, however, as it marks one of the most important milestones for Social Security: The age at which you have truly maximized out your potential benefit. (More on that in a moment.)
And yet, it’s exceedingly uncommon for Americans to hold off until they become septuagenarians—the vast majority of adults begin receiving Social Security benefits checks much earlier. Specifically, according to the Transamerica Center for Retirement Studies’ 2023 Life in Retirement: Pre-Retiree Expectations and Retiree Realities report, only 4% of retirees waited until age 70 to start the Social Security clock.
Why do so few people delay receiving Social Security benefits when doing so can mean markedly higher payments down the line? Well, it’s not just a matter of willpower and patience—there are several legitimate reasons to begin earlier. So read on as I dive into why most people start collecting Social Security younger than age 70, and how to determine your ideal Social Security start date.
How Is Social Security Calculated?
The size of your Social Security benefit is determined by a few factors, including your age. But before we get to the age element, let me explain the role your earnings history plays.
Social Security’s benefit formula adjusts (indexes) a worker’s covered earnings (wages and self-employment income that are subject to Social Security taxes) to reflect the rise in standard of living over their working years, then adds up the 35 years with the highest indexed earnings, and divides them by the total number of months across those years. (If a person has fewer than 35 years of covered earnings, they receive a zero for each year under 35 when calculating the average.) The number is then rounded down to provide a figure called “average indexed monthly earnings,” or AIME.
A person’s primary insurance amount, or PIA (your benefits before factoring in early retirement, delayed retirement credits, cost-of-living adjustments, etc.), is calculated by multiplying different brackets of AIME by different factors. These brackets are adjusted every year.
In 2025, the calculation goes like this:
- 90% of the first $1,226 of AIME, plus
- 32% of AIME above $1,226 and through $7,391, plus
- 15% of AIME above $7,391
In other words, at certain thresholds, higher pay has a diminishing impact on your Social Security benefits.
By the way, if you didn’t keep your tax returns from the last 35 years … virtually no one does, and that’s OK! You can see your estimated monthly Social Security benefit amount in your SSA account.
Related: What Are Social Security Spousal Benefits [And How Do They Work]?
When Can I Start Collecting Social Security?
The Social Security retirement benefits most of us think of are “Old-Age” benefits, which you can begin collecting as early as age 62.
But the key word there is “early.” Each person has a “full retirement age,” or FRA. If you retire earlier than that, your future monthly benefits will be permanently reduced. And the farther away you are from your FRA, the greater the reduction.
Your FRA depends on your birth year. Currently, the brackets for one’s FRA are as follows:
- Born between 1943 to 1954: 66
- Born in 1955: 66 and 2 months
- Born in 1956: 66 and 4 months
- Born in 1957: 66 and 6 months
- Born in 1958: 66 and 8 months
- Born in 1959: 66 and 10 months
- Born 1960 or later: 67
Once you reach FRA, you qualify to receive 100% of your earned Social Security benefits.
That said, 100% isn’t the most you can earn.
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The Advantages of Delaying Social Security
You can collect your full benefit amount when you reach full retirement age. But if you delay collecting Social Security until past your FRA, you can actually increase your benefit past 100%.
For each month you delay collecting Social Security, you earn a delayed retirement credit that increases your benefit by a set amount. The monthly rate of increase depends on your birth year:
- Born 1933-34: 11/14 of 1% (5.5% 12-month rate of increase)
- Born 1935-36: 1/2 of 1% (6.0% 12-month rate of increase)
- Born 1937-38: 13/24 of 1% (6.5% 12-month rate of increase)
- Born 1939-40: 7/12 of 1% (7.0% 12-month rate of increase)
- Born 1941-42: 5/8 of 1% (7.5% 12-month rate of increase)
- Born 1943 or later: 2/3 of 1% (8.0% 12-month rate of increase)
However, delayed retirement credits (and thus your benefit) max out once you reach age 70. So while there’s an advantage to waiting until you reach age 70 to retire, there are no additional perks for waiting any longer than that.
Based on Morningstar research, people in retirement who want the highest level of lifetime income should consider waiting to file for Social Security benefits. “However, the benefit of delayed filing is the most pronounced if the retiree can use nonportfolio income, such as a part-time job or rental income, to provide cash flows until Social Security benefits begin,” Morningstar says. That allows the retiree to delay taking withdrawals from tax-advantaged retirement accounts, which gives the account funds more time to grow.
Delaying Social Security can also be beneficial in a situation where a younger, lower-earning spouse is married to an older, higher-earning spouse, as the younger spouse can take the larger benefit as their own if the older spouse passes away first.
Related: How to Maximize Social Security Spousal Benefits
The Disadvantages of Delaying Social Security
Delaying Social Security doesn’t make sense for everybody, even if it could potentially result in more money collected in the long run.
Among the considerations that might lead you to decide to take Social Security earlier than age 70? Your life expectancy, whether you have the financial resources to cover essential expenses without those benefits, and even your belief in Social Security’s stability.
Related: 10 Common Social Security Mistakes You Should Know
You Might Need to Withdraw From Tax-Advantaged Retirement Accounts
Let’s pretend that life’s circumstances necessitate that you retire at age 67. Unless you have other income sources, delaying Social Security could force you to take withdrawals (or higher withdrawals than you originally expected) from your retirement accounts.
If that’s the case, delaying your Social Security benefit could be detrimental to your financial health. Why? The reduction in your retirement accounts’ growth potential could more than offset what you would gain from the higher benefit check.
Retiring on a combination of both Social Security benefits and portfolio withdrawals (as well as other income sources) also helps to protect against “sequence of returns risk.” This is the risk that a bear market or other market conditions shrink your portfolio early in your retirement, which can amplify the toll that each withdrawal takes on your investment account and result in running out of retirement funds far earlier than expected.
Related: 10 Things Original Medicare Doesn’t Cover
You Have a Low Life Expectancy
If you’re in very poor health and don’t expect to have a very long remaining life, waiting until age 70 to collect a maxed-out benefit might be downright impractical.
Indeed, depending on your situation, you might want to begin receiving Social Security checks before you even reach FRA. Because while a reduced monthly check might not be ideal, delaying your filing could result in you receiving few (or even none) of your earned benefits.
To be clear: Many people overestimate their longevity risk.
“Longevity risk is a problem that’s also happening more, and it has the potential to be more common today than we’ve seen in the past,” says R. Dale Hall, FSA, MAAA, CFA, CERA, Managing Director of Research at Society of Actuaries. “In 2024, roughly 100,000 people were expected to reach 100 years of age in the U.S., according to [estimates from the U.S.] Census Bureau. But looking forward, the Census Bureau says that could quadruple to more than 420,000 by 2054.”
Everyone has a breakeven point where missing out on early payments is made up for by the larger size of later payments. However, if you have a serious health condition that doctors believe will shave many years off your life, you should weigh that heavily when considering a late retirement. Just make sure that your retirement plan at least accounts for the possibility that you might live longer than you expect.
Related: Can You Receive Social Security Benefits While Working?
You Worry Social Security Will Be Weakened or Not Exist
I’m not here to give my opinion about the future of Social Security.
Some people believe it will continue to function as normal for decades to come, while others fear the program is unsustainable and won’t have much money left by the time they retire. And if you’re in the latter group, I can understand wanting to collect your benefit as soon as possible.
Roughly 40% of Americans worry Social Security will be reduced or not exist in the future, per the Transamerica Center for Retirement Studies’ 2024 The Retirement Outlook of the American Middle Class report.
Some of this fear stems from statements from the Social Security Administration itself. The SSA’s 2024 report on the Status of the Social Security and Medicare Programs states that the Old-Age and Survivor’s Insurance Trust Fund will only be able to pay 100% of the total scheduled benefits until 2033. At that point, the fund’s reserves will be depleted and the program income will only be sufficient to pay out 79% of scheduled benefits.
It’s possible funds could be drawn from elsewhere to supplement the difference, but not everybody believes that would be the case.
Related: How Are Social Security Benefits Taxed?
How Else Can I Fund My Retirement?
Social Security isn’t designed to be a person’s sole source of income during retirement, so it’s vital to plan on funding your retirement through additional methods.
Those who have jobs with pensions might be able to live completely off of that income alone until they start claiming Social Security.
Many people take withdrawals from tax-deferred or tax-exempt retirement accounts. The longer you keep money within those accounts, the greater their growth potential. (That said, some tax-deferred accounts are eventually subject to required minimum distributions, or RMDs.) Some people also use earnings from taxable brokerage accounts to fund their lifestyle.
You can also support your retirement with savings products, such as certificates of deposit (CDs), money market accounts (MMAs), and other cash equivalents. Insurance and real estate are common choices as well.
Some people choose to only partially retire and work part-time as an employee or contractor. Although this is an excellent way to ensure ongoing income, keep in mind that continuing to work isn’t always feasible. In older age, a person might struggle to find work for a number of reasons, from antiquated skill sets to ageism to health issues that make work challenging or impossible.
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