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- The Average Social Security Check at 70 Might Surprise Future Retirees (financebuzz.com)
Most Americans opt to claim Social Security benefits well before age 70, even though delaying until then can significantly increase their monthly payments. According to recent data from the Social Security Administration (SSA), only about 9% of new retirees wait until age 70 or later to start collecting benefits.
Experts note that many retirees focus on when they become eligible rather than when it’s financially advantageous to claim. Understanding this distinction is crucial for those seeking a more secure retirement.
Early Claiming at Age 62: The Most Accessible but Reduced Benefit
Social Security eligibility begins at age 62, making it the earliest age for claiming benefits. In 2024, approximately 23% of eligible seniors chose to claim at this age. The average monthly benefit for new claimants at 62 was around $1,335.
However, claiming this early results in a permanent reduction in monthly payments-up to 30% less than what they would receive if they waited until full retirement age. This reduction reflects the longer period over which benefits will be paid.
Full Retirement Age: A Popular Middle Ground
Full retirement age (FRA) varies between 66 and 67, depending on birth year. The SSA reports that 66 is currently the most common age to claim benefits. Those who wait until FRA avoid the early claiming penalty, resulting in higher monthly payments than those who claim at 62.
Because both FRA and benefit amounts depend on individual factors like birth year and lifetime earnings, average payments vary. Nonetheless, waiting until FRA generally boosts monthly benefits without the longer wait required to reach age 70.
Waiting Until 70: The Biggest Payoff
For each year after FRA that retirees delay claiming, up to age 70, their benefits increase by about 8%. As a result, the average monthly benefit for new claimants at age 70 in 2024 was roughly $3,235-about $1,900 more per month than the average benefit at age 62.
These delayed retirement credits provide higher lifetime income and can also increase survivor benefits for spouses. The trade-off is foregoing Social Security payments for up to eight years while waiting.
Why Most Don’t Wait Until 70
Despite the financial incentive to delay, only about 8.7% of retirees in 2024 waited until age 70 to claim benefits. Several factors contribute to this trend:
- Early retirement due to health issues or job loss
- Immediate income needs to cover living expenses
- Concerns about life expectancy and whether delaying will pay off
- Preference for receiving payments sooner rather than later
How to Choose the Best Time to Claim Social Security
Selecting when to claim is one of the most significant financial decisions retirees face, with long-term income implications. The ideal claiming age depends on multiple personal factors, including health, life expectancy, savings, employment plans, and household finances-not just the size of the monthly benefit.
- If you expect a long retirement: Good health and a family history of longevity may make waiting until 70 advantageous, as higher monthly payments offer greater lifetime income and better protection against inflation.
- If you need income now: Forced early retirement or caregiving responsibilities may necessitate claiming benefits early to replace lost income.
- If you’re married: Couples should coordinate claiming strategies. Typically, the higher-earning spouse benefits most from delaying, as it boosts survivor benefits later on.
- If you have other retirement savings: Using assets from a 401(k) or IRA to cover expenses while delaying Social Security can effectively “buy” a larger guaranteed monthly income.
Before making a decision, retirees should compare estimated benefits at ages 62, FRA, and 70, factoring in expenses, taxes, life expectancy, and other income sources.
The Bottom Line
While waiting until age 70 is not the best choice for everyone, it can result in dramatically higher monthly benefits-sometimes nearly $2,000 more. Retirees should assess their financial situation carefully and choose a claiming strategy that aligns with their overall retirement goals rather than simply chasing the largest monthly check.
Tips to Improve Your Financial Health in Retirement
Regardless of your current finances, there are always ways to strengthen your financial position:
- Increase your income: Explore side hustles or other income sources that fit your lifestyle.
- Grow your savings: Start with a clear financial plan and consider professional advice to maximize growth through compound interest.
- Take advantage of savings opportunities: Use discounts and shop around for better rates, such as on auto insurance, to stretch your retirement dollars further. Be cautious of hidden expenses that can erode your savings.
Making thoughtful decisions about Social Security and managing your finances proactively can help ensure a more comfortable and secure retirement.
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- The Average Social Security Check at 70 Might Surprise Future Retirees (financebuzz.com)