Almost every retiree wrestles with the same nagging dilemma: Should you jump the gun and tap into Social Security benefits early, or hold off and play the waiting game? It’s a tricky call, partly because individual circumstances differ wildly, and partly due to the looming risk of outliving your income stream.
Regrettably, a vast number of retirees face this challenge without adequate guidance, while the Social Security Administration (SSA) and its agents often falter — one specialist bluntly calls their support “dreadful” — in steering folks toward the optimal claiming time.
Let’s crunch some figures, tossing around a rough-and-ready calculation on when you might break even by claiming Social Security, and unpack why delaying benefits until 70 might be the savvy move.
Claiming Age and Your Expected Social Security Earnings
Though you can technically claim Social Security benefits as early as age 62, doing so locks in a permanently reduced payout — retirees frequently accept a lower monthly amount indefinitely instead of waiting for a heftier check.
But how steep is the price tag on grabbing a smaller check sooner? The impact is surprisingly substantial.
Claiming at your *full retirement age* (which is 67 for folks born in 1960 or later) guarantees your complete monthly benefit. Hold out until age 70, and you’ll unlock additional bonuses — an enticing carrot since benefits stop growing past 70, wiping out incentive to delay further.
Besides nudging you to wait until full retirement age, Social Security dangles even more upside for those willing to hold off — an 8% annual boost on benefits for up to three years beyond full retirement age, applicable for those born in 1960 or after.
Imagine your full benefit clocks in at $1,000 monthly at age 67; by holding till 70, that grows to $1,240.
“Adjusted for inflation, benefits at age 70 are 77% higher than what you’d receive at 62,” notes Laurence Kotlikoff, Boston University economics professor and co-author of Get What’s Yours: The Secrets to Maxing Out Your Social Security. “Waiting yields a massive payoff.”
With these figures laid bare, let’s survey a straightforward model to gauge when filing makes sense for a typical individual — then dissect why your own circumstances might call for a different path.
Crunching the Break-Even Age: When Does Waiting Pay Off?
Seeking to squeeze the lifetime total from Social Security? A break-even analysis is a good compass to determine the ideal filing age.
For clarity’s sake, we’ll peg your full retirement benefit at $1,000 monthly and factor 2% annual cost-of-living adjustments, applied to both early claiming at 62 and the enhanced payment starting at 70.
At 62, expect roughly 30% less than the full amount—around $700 a month. At 70, thanks to the delayed credits, your benefit jumps to $1,240 plus those inflation-linked increments.
Benefit Comparison by Age
| 62 | $8,400 | $0 | $8,400 | $0 |
| 63 | $8,568 | $0 | $16,968 | $0 |
| 64 | $8,739 | $0 | $25,707 | $0 |
| 65 | $8,914 | $0 | $34,622 | $0 |
| 66 | $9,092 | $0 | $43,714 | $0 |
| 67 | $9,274 | $0 | $52,988 | $0 |
| 68 | $9,460 | $0 | $62,448 | $0 |
| 69 | $9,649 | $0 | $72,097 | $0 |
| 70 | $9,842 | $17,434 | $81,939 | $17,434 |
| 71 | $10,039 | $17,783 | $91,978 | $35,217 |
| 72 | $10,240 | $18,139 | $102,217 | $53,356 |
| 73 | $10,444 | $18,501 | $112,662 | $71,857 |
| 74 | $10,653 | $18,871 | $123,315 | $90,729 |
| 75 | $10,866 | $19,249 | $134,181 | $109,978 |
| 76 | $11,084 | $19,634 | $145,265 | $129,611 |
| 77 | $11,305 | $20,027 | $156,570 | $149,638 |
| 78 | $11,531 | $20,427 | $168,101 | $170,065 |
| 79 | $11,762 | $20,836 | $179,863 | $190,901 |
| 80 | $11,997 | $21,252 | $191,861 | $212,153 |
Source: Social Security Administration data.
By roughly 78 years of age, the late claimant surpasses the early bird in total benefits received. Beyond that tipping point, the delayed filer pulls in at least $9,000 more annually — or an extra $750 a month.
Extend the calculation to age 90, and the late claimant enjoys an additional $103,000+ from age 80 onwards — translating to over $10,000 yearly extras. Summed up, this late-claim strategy nets roughly $123,659 more over the lifetime than claiming early. Naturally, doubling the initial benefit ($2,000 instead of $1,000) doubles these advantages.
Life Expectancy and The Real Gamble
If longevity is in your cards — and few bet against it — waiting tends to trump early claiming, all else equal. The crux lies in outliving your break-even point.
According to the U.S. Census Bureau:
- Men aged 62 can expect about 21 more years, til roughly 83;
- Men aged 70 typically have 15 extra years, reaching around 85;
- Women’s expectations edge higher by approximately 2.8 years at 62 and 2.2 years at 70, respectively.
This break-even of about 78 years favors those destined for longer lives to claim later and harvest more cash. Yet, in 2022, just 10.4% of new retirees snagged benefits at 70 or beyond, per Social Security stats.
Does it seem wild so many jump in early? Not necessarily — the “average” doesn’t apply to us all, and there are many legitimate reasons behind early claims.
Why Some People Grab Benefits Early
While Kotlikoff argues that “for 85% of Americans filing at 70 is ideal,” he acknowledges many file sooner due to pressing needs.
- You Need Immediate Cash Flow: With retirement savings often in dire shape nationwide, some just can’t wait.
- You’re Not Expecting to Live Much Longer: Despite statistical life expectancy, some individuals realistically anticipate a shorter lifespan, making earlier claims a sound move.
- You’re Not Chasing Maximum Lifetime Benefits: Some prefer to enjoy their funds now — leaving the grind behind, traveling, visiting loved ones, or simply soaking in life’s pleasures.
- Unique Circumstances: Kotlikoff points out that Social Security isn’t a one-size-fits-all; 13 distinct benefits exist, covering disabled folks, ex-spouses, survivors, minors, and others, making simplistic break-even math insufficient guidance.
Given this varied landscape, building a personalized claiming blueprint is crucial. Kotlikoff warns about poor advice from Social Security staff, urging retirees to seek help from experts who truly understand the program’s complexities and prioritize your interests.
Patience Pays: Why Waiting Till 70 Can Be Worth It
Only a small slice of retirees hold off until 70, even though those benefits swell by roughly 24% above the full retirement sum.
- You Expect To Surpass Average Lifespan: Playing the numbers game might point one way, but your personal longevity odds might favor waiting.
- Guard Against Outliving Your Savings: The Bipartisan Policy Center flags that about 15% of men aged 62 reach 92, and 14% of women live to at least 95. Early claimers risk running dry and being stuck with diminished monthly checks for years on end.
- You Want to Squeeze Maximum Payout: If you poured decades into Social Security contributions, deferring withdrawal so benefits grow maximizes your haul — though it’s no ironclad guarantee.
- Spousal Strategies: Sometimes couples stagger claims — one taps benefits early for income; the other delays to pad their payout — balancing short-term needs with long-term gains.
Deciding the perfect Social Security claiming age is no walk in the park, especially when factoring in lifespan uncertainty, tax considerations, and other income sources that shift with your timing. Getting proficient counsel can make all the difference — often repaying its cost many times over through smarter choices.
