At what age should I take Social Security?

Social Security is the main source of income for most seniors, according to the Social Security Administration (SSA). Even if you have other retirement accounts, it’s natural to look forward to receiving the Social Security benefits you’ve worked so hard for.1

When it comes to receiving the maximum Social Security benefit possible, timing is important. Sometimes beneficiaries may receive more by delaying withdrawal, but some older adults may need the funds sooner.

Start by asking yourself some questions:

  • Do I want to retire early?
  • Do I want to/need to work past age 70?
  • What happens to my Medicare if I work past age 65?

The SSA website offers future planning calculators, opens new window to help you estimate things that can affect retirement. These include life expectancy, pension eligibility, spousal benefits and retirement age.2

How soon can I take Social Security?

While you can take benefits as early as age 62, it may not be recommended. Only those on disability, or surviving spouses, can take Social Security earlier than 62.3

Your full retirement age, also known as “normal retirement age,” determines if you can receive full benefits. While the original full retirement age was 65 for all, here’s a snapshot of how the law has changed:

Year of birth Normal retirement age 1938–1942 65 1943–1958 66 1956 66 and 4 months 1957 66 and 6 months 1958 66 and 8 months 1959 66 and 10 months 1960 67

If you take Social Security up to 36 months before your full retirement age, your benefit will be permanently reduced (on a monthly basis) by 5/9 of 1%. If you withdraw more than 36 months early, your benefit is reduced by 5/12 of 1% each month.4

Why should I wait?

You can take your Social Security benefits early or when you reach retirement age. You can also delay benefits.5 Whether you're still working or have budgeted enough to live without Social Security benefits, you may be on the plus side when it comes to your monthly payout.

If your full retirement age is 66 or older, check out this chart, opens new window to see how delaying retirement—even just by several months—could affect your Social Security benefits to your advantage.

You can also use this retirement benefits planner, opens new window to determine the best time to access your Social Security benefits.

Will taking Social Security at any time affect my Medicare?

Though they are separate programs, there are some beneficial connections between them.

If you're receiving Social Security benefits, Social Security works with Medicare and you'll get an initial enrollment package from Medicare 3 months before the month of your 65th birthday.

Also, your Medicare premiums will most likely be collected by Social Security if you are already receiving those benefits. Social Security will send a notice before the deductions begin. If you aren’t receiving Social Security retirement benefits, you'll get a monthly bill from Medicare.6

Plan first, withdraw later

Healthcare coverage can be a major retirement expense, and Medicare is not all-inclusive. Before you choose to take Social Security, make sure you've reviewed your budget, being careful to factor in healthcare costs, inflation and unexpected events.

Don't underestimate those expenses. A fixed income may not allow for much fluctuation. Also people are living longer, so retirement may be longer than you plan for. According to the SSA, more than 1 in 3 of today's 65-year-olds will live to age 90. More than 1 in 7 will live to age 95.7

The decision of when to take Social Security is important and personal. It will likely factor in to how you meet current and future healthcare needs.

Plan before you make your next move, and be better prepared for what lies ahead. For added peace of mind, consult a financial advisor before making any major decisions about your Social Security and retirement date.

Sources

  1. “Monthly Statistical Snapshot, March 2019,” Social Security Administration, last accessed August 19, 2019, www.ssa.gov/policy/docs/quickfacts/stat_snapshot/2019-03.html, opens new window .
  2. “Monthly Statistical Snapshot.”
  3. Rob Williams, “When Should You Take Social Security?,” Charles Schwab, last accessed August 19, 2019, www.schwab.com/public/schwab/nn/articles/When-Should-You-Take-Social-Security, opens new window.
  4. Rob Williams, “When Should You Take Social Security?”
  5. “When to Start Your Benefits,” Social Security Administration, last accessed August 19, 2019, https://www.ssa.gov/planners/retire/applying1.html, opens new window.
  6. Stan Hinden, “How Social Security and Medicare Work Together,” AARP, last accessed August 19, 2019, https://www.aarp.org/work/social-security/info-2015/social-security-medicare-in-retirement.html, opens new window.
  7. “When to Start Receiving Retirement Benefits,” Social Security Administration, last accessed August 19, 2019, https://www.ssa.gov/pubs/EN-05-10147.pdf, PDF opens new window.

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