Few financial decisions have as much long-term impact as when to claim Social Security. The difference between claiming at 62 versus 70 can exceed $100,000 in lifetime benefits—sometimes much more. Yet most people claim early, leaving significant money on the table. Here's how to think through this critical choice.
The Basics: How Age Affects Your Benefit
Your Social Security benefit is calculated based on your 35 highest-earning years, adjusted for inflation. This creates your Primary Insurance Amount (PIA)—the benefit you'd receive at your Full Retirement Age (FRA).
For those born in 1960 or later, FRA is 67. But you can claim as early as 62 or as late as 70:
- Claim at 62: Receive 70% of your PIA (30% permanent reduction)
- Claim at 67 (FRA): Receive 100% of your PIA
- Claim at 70: Receive 124% of your PIA (8% increase per year past FRA)
That's a 77% difference between the lowest and highest benefit. If your PIA is $2,500/month, claiming at 62 yields $1,750/month while claiming at 70 yields $3,100/month. Over a 25-year retirement, that difference totals over $400,000.
The Break-Even Analysis
A common way to analyze claiming age is the break-even calculation: at what age does waiting pay off?
If you delay from 62 to 67, you forgo 60 months of smaller payments to get larger payments later. Typically, the break-even point is around age 78-80. Live past that, and delaying wins. Die before, and early claiming wins.
But break-even analysis has limitations:
- It ignores the time value of money
- It treats the decision as purely mathematical, ignoring personal circumstances
- It doesn't account for survivor benefits
- Average life expectancy isn't your life expectancy
Beyond Break-Even: Factors That Matter
Your Health and Longevity
Family history and current health matter. If your parents lived into their 90s and you're healthy at 62, the odds favor delaying. If you have serious health issues, claiming earlier makes more sense.
Remember: you're not betting on whether you'll live to 80. You're managing the risk of living to 95 without adequate income. Social Security is longevity insurance—it pays more the longer you live.
Your Spouse's Benefit
For married couples, Social Security planning gets more complex—and more important. The higher earner's benefit becomes the survivor benefit when one spouse dies. Delaying the higher earner's claim protects the surviving spouse.
Consider: if you claim at 62 and die at 75, your spouse receives your reduced benefit for potentially decades. If you'd delayed to 70, they'd receive that larger amount instead.
Other Income Sources
If you have pensions, significant retirement savings, or plan to work in your 60s, you can afford to delay Social Security and let it grow. If Social Security is your primary income source, you may need to claim earlier.
Taxes
Delaying Social Security while drawing down retirement accounts in your 60s can be tax-efficient. You convert tax-deferred money at lower brackets, then enjoy a larger Social Security benefit (which may be partially tax-free) later.
The Zen Take
Social Security is one of the few sources of inflation-adjusted, guaranteed lifetime income. Maximizing this benefit—especially for the higher earner in a married couple—provides irreplaceable security. Don't let the immediate appeal of "getting your money" override the long-term math.
Common Claiming Strategies
Strategy 1: Claim Early, Invest the Difference
Some argue for claiming at 62 and investing the benefits. The math rarely works: you need consistent 7%+ returns to beat the guaranteed 8% annual increase from delaying. Markets don't guarantee returns; delayed Social Security does.
Strategy 2: Higher Earner Delays, Lower Earner Claims Early
For married couples with different earning histories, this can work well. The lower earner claims early to provide income while the higher earner delays to maximize the eventual survivor benefit.
Strategy 3: Both Delay Until 70
If you have sufficient other resources, both spouses delaying maximizes lifetime benefits—but requires other income sources to bridge the gap.
Strategy 4: Claim at FRA
A middle-ground approach. You avoid the early-claiming penalty without waiting until 70. Reasonable for those with average health and moderate other resources.
The Working-While-Claiming Complication
If you claim before FRA and continue working, the earnings test reduces your benefit. In 2025, if you earn above $23,400, $1 of benefits is withheld for every $2 earned above that threshold.
This isn't a permanent loss—your benefit is recalculated at FRA to account for withheld payments—but it complicates planning and cash flow. Generally, if you're still earning significant income, it makes sense to delay claiming.
Spousal and Survivor Benefits
Spousal benefits: A spouse can receive up to 50% of the other spouse's PIA, if that's higher than their own benefit. Spousal benefits don't increase past FRA, so there's no bonus for delaying past 67.
Survivor benefits: When a spouse dies, the survivor receives the higher of their own benefit or the deceased's benefit (including any delayed retirement credits). This is why delaying the higher earner's benefit is so valuable—it protects both spouses.
Special Situations
Divorced? If married 10+ years, you may claim on your ex-spouse's record without affecting their benefit. Same age-based reductions apply.
Government pension? The Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) may reduce your Social Security. Consult SSA for specifics.
Continuing to work? Your benefit is recalculated annually. High-earning years after you start claiming can increase your benefit by replacing lower-earning years in the 35-year calculation.
Making Your Decision
Consider these steps:
- Create a My Social Security account at ssa.gov to see your estimated benefits at different claiming ages
- Assess your health honestly. Family history, current conditions, lifestyle factors
- Consider your spouse's situation. Coordinate strategies for maximum household benefit
- Model your retirement income. Can you afford to delay? What's the trade-off?
- Factor in taxes. Consider the interaction with other retirement income
- Use planning tools. Open Social Security, Social Security Solutions, and similar tools model different scenarios
The Bottom Line
Most people claim Social Security too early. The pull of immediate money is strong, and we tend to underestimate how long we'll live. But for many people—especially higher earners, married couples, and those in good health—delaying to 70 is the optimal choice.
This decision deserves careful analysis, not a gut reaction. A few hours of planning around a $100,000+ decision is time well spent.