Social Security is actually pretty flexible in that it allows you to sign up for benefits at any time once you reach age 62. Now financially speaking, there’s no reason to delay your filing past the age of 70, but even so, you get a solid eight-year window of time to claim your benefits — income that could help get you through retirement.
Now you should know that your monthly retirement benefit is calculated based on your personal wage history – specifically, your top 35 years of earnings. But you’re only entitled to that benefit once you reach full retirement age, or FRA.
FRA depends on your year of birth, and you can consult this table to see what yours is:
Year of Birth
Full Retirement Age
66 and 2 months
66 and 4 months
66 and 6 months
66 and 8 months
66 and 10 months
1960 or later
Here are a few good reasons to sign up for benefits at your precise FRA — and not sooner or later.
1. Your benefits won’t take a hit
Claiming Social Security at 62 is tempting — after all, you get to collect your benefits much sooner than you would by waiting until FRA. But for each month you sign up for Social Security ahead of FRA, your monthly benefit gets reduced, and that decrease then remains in effect on a permanent basis. The upside of filing at FRA is that you won’t cut your benefits. And given the many expenses you might face in retirement, from housing to healthcare to keeping yourself busy, that’s important.
2. You won’t have to wait too long for your money
For each year you delay your Social Security filing past FRA, your benefits increase 8%, up until age 70 — and that boost is a permanent one. The downside, of course, is that you may want to retire earlier than age 70, and without Social Security, that may not be possible. If you sign up for benefits at FRA, you won’t have to wait too long to get the money you’re entitled to.
3. You may be more likely to break even in your lifetime
The interesting thing about Social Security is that it’s designed to pay you the same total lifetime benefit regardless of when you actually file. The logic goes like this — filing early will give you a lower monthly benefit but more months of benefits, and delaying benefits past FRA will give you more money each month but fewer months of benefits. All should even out if you live an average lifespan. Therefore, if you expect to live as long as the typical senior — meaning, you have no reason to suspect you’ll pass away at a young age but also don’t necessarily expect to live until well into your 90s — then signing up at FRA could put you in a good position to break even. And that alone could take some of the stress off of filing.
The decision to sign up for Social Security benefits is an important one, and a choice you don’t want to botch. While there are plenty of good reasons to sign up early or delay your filing as long as possible, it pays to think about what you might gain by claiming benefits at your FRA on the nose.
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