Should You Claim Social Security in 2023?

You may have a number of big plans in the works for 2023. Those could include travel, home renovations, and signing up to start receiving Social Security benefits if you’re old enough.

You can file for Social Security beginning at age 62. If you were born in 1961 or earlier, signing up for Social Security in the new year is an option (if not at the start of the year, then at some point).

But while you might be allowed to claim Social Security in the new year, whether you should is a different story. And you’ll need to consider that decision carefully to avoid making a mistake.

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Is the timing right to sign up for benefits?

You’re entitled to your full monthly Social Security benefit based on your earnings history once you reach full retirement age (FRA). That age is either 66, 67, or somewhere in between — it depends on your year of birth.

Claiming Social Security even a month ahead of your FRA will generally result in a reduced benefit for life. If your FRA is 67 and you file at age 66 1/2, you’re not looking at such a massive hit to your monthly income. But if you claim Social Security at 62, you’ll be looking at a reduction of 25% to 30%, depending on your precise FRA.

Even if you’re not filing that early — say, you’re thinking of enrolling in Medicare at age 65 and claiming Social Security while you’re at it — you should still understand that you’re settling for a lower monthly benefit for life. That’s a potentially dangerous thing if you don’t have a particularly large nest egg.

Therefore, if you’re inclined to claim Social Security in 2023, ask yourself:

What do my savings look like? If you don’t have a lot of money tucked away for retirement, it could really pay to hold off.
Am I still working? If you have money coming in from a job, you may not need Social Security to cover your expenses. But if you earn money from employment and file for benefits before FRA, you risk having some of those benefits withheld if your income is too high.
What goals will waiting to file help me achieve? The longer you wait to claim Social Security (up until age 70), the higher a monthly benefit you’ll be able to snag. That’s because you’ll get a boost in benefits for each month you delay your filing past FRA. You may not need a larger benefit to cover things like food and housing, but a higher benefit could make it possible to travel more as a senior and meet other retirement goals.

The decision to sign up for Social Security is a big one. If you’re thinking of taking that leap in the new year, do a lot of thinking beforehand to make certain it’s really the right call. You don’t want to file for benefits at the wrong time, only to kick yourself for years after the fact.

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