Should I Take Social Security at 67 or 70?

Social Security plays a significant role in the financial landscape for many individuals approaching retirement. Deciding when to begin receiving benefits is a personal choice with long-term financial implications. For many, the choice often narrows to claiming benefits at age 67 or waiting until age 70. This decision involves understanding program rules and your individual circumstances.

Understanding Full Retirement Age and Delayed Retirement Credits

Social Security defines Full Retirement Age (FRA) as the age you are entitled to receive 100% of your Primary Insurance Amount (PIA), your basic benefit amount. For individuals born in 1960 or later, this age is 67. If you were born between 1943 and 1959, your FRA falls between age 66 and 66 years and 10 months, depending on your birth year. Claiming benefits at your FRA means you receive the full monthly amount calculated from your earnings history.

If you delay claiming benefits past your FRA, up to age 70, you can earn Delayed Retirement Credits (DRCs). These credits permanently increase your monthly benefit. For those born in 1943 or later, each year you delay claiming beyond your FRA adds 8% to your annual benefit. This translates to an increase of two-thirds of 1% for each month you postpone payments. For example, delaying from an FRA of 67 to age 70 can result in a 24% increase in your monthly benefit.

Claiming benefits before your FRA results in a permanent reduction of your monthly payment. For someone with an FRA of 67, taking benefits at the earliest age of 62 leads to a 30% reduction. The reduction rate is five-ninths of 1% for each of the first 36 months before FRA, and five-twelfths of 1% for each additional month.

Key Considerations for Your Decision

Your personal health and family history of longevity are important factors when deciding when to claim Social Security benefits. If you anticipate living a longer-than-average life, delaying benefits can provide a larger cumulative payout over your lifetime due to increased monthly amounts from Delayed Retirement Credits. Conversely, if health concerns suggest a shorter life expectancy, claiming benefits earlier might be more advantageous to maximize total benefits received.

Current and future income needs also play a significant role. If you require immediate income to cover living expenses or bridge a gap between working and full retirement, claiming benefits at age 67 might be necessary. However, if you have sufficient other retirement funds or plan to continue working, delaying until age 70 could allow you to secure a higher monthly Social Security payment for the rest of your life.

The claiming age also impacts potential spousal and survivor benefits. A spouse may be eligible for benefits based on your earnings record, typically up to 50% of your Primary Insurance Amount at their Full Retirement Age. Spousal benefits can be claimed as early as age 62, but are subject to reduction if taken before the spouse’s FRA. Survivor benefits allow a surviving spouse to receive 100% of the deceased worker’s benefit if the survivor has reached their own FRA, or a reduced amount if claimed as early as age 60 (or 50 if disabled). Delaying your own benefits can provide a larger income stream for a surviving spouse.

Continuing to work while receiving Social Security benefits, especially before your FRA, can affect your payments. If you are under your FRA for the entire year and earn above a certain limit, your benefits may be reduced. For 2025, the annual earnings limit for those under FRA is $23,400, with $1 in benefits deducted for every $2 earned above this amount. In the year you reach your FRA, a higher limit applies ($62,160 in 2025 before the month you reach FRA), and $1 is deducted for every $3 earned above it. Once you reach your FRA, there is no earnings limit.

Inflation and its impact on purchasing power are also considerations. While Social Security benefits are subject to annual Cost-of-Living Adjustments (COLAs), a higher initial benefit amount, achieved by delaying claims, provides a larger base for these adjustments. This can help maintain your purchasing power over time. The decision to claim early or late should align with your overall financial plan and how other income sources, such as pensions or 401(k) withdrawals, integrate with your Social Security income.

Estimating Your Social Security Benefits

To make an informed decision about when to claim Social Security, estimate your personalized benefit amounts. The most direct way is accessing your Social Security Statement online. You can create a secure “my Social Security” account on the Social Security Administration’s (SSA) official website. This online account provides access to your earnings history and personalized estimates of your future benefits.

Your Social Security Statement typically includes estimated benefit amounts at different claiming ages, such as age 62, your Full Retirement Age, and age 70. The statement also shows your detailed earnings record, which is what your benefits are based on.

Consider a hypothetical example to illustrate the impact of delaying benefits. If your Full Retirement Age is 67 and your monthly benefit at that age is $1,800, delaying until age 70 could increase your monthly benefit by 24% due to Delayed Retirement Credits. This would result in a monthly payment of approximately $2,232. Conversely, claiming at age 62 with an FRA of 67 would reduce that $1,800 benefit by 30%, resulting in a monthly payment of $1,260.

The SSA also provides online calculators to help you model different claiming scenarios. These tools allow you to input your information and see how your benefit amount might change based on your chosen retirement age. While some “quick calculators” provide rough estimates, others, particularly those accessed through your “my Social Security” account, can provide more precise calculations based on your actual earnings record.

Integrating Social Security with Other Retirement Funds

The decision of when to claim Social Security benefits should be part of a comprehensive retirement income strategy. Delaying Social Security benefits, particularly to age 70, can allow your other retirement accounts, such as 401(k)s and IRAs, to continue growing. This strategy can be beneficial if you have sufficient savings to cover expenses during the years you defer Social Security, potentially leading to a larger, more secure income stream later in retirement.

Social Security benefits can be subject to federal income tax, depending on your provisional income. Provisional income is calculated by adding your adjusted gross income, any non-taxable interest, and half of your Social Security benefits. For single filers, up to 50% of benefits may be taxable if provisional income is between $25,000 and $34,000, and up to 85% if it exceeds $34,000. For married couples filing jointly, these thresholds are $32,000 to $44,000 for 50% taxation and over $44,000 for 85% taxation.

Your Social Security claiming age can influence your withdrawal strategies from other retirement accounts. If you claim Social Security earlier, you might draw less from your tax-deferred accounts, potentially allowing those funds to grow longer. Conversely, if you delay Social Security, you might need to rely more heavily on other retirement savings in the interim. This interplay affects the sequence and amount of withdrawals from taxable, tax-deferred, and tax-free accounts, impacting your overall tax efficiency throughout retirement.

Legacy planning considerations also tie into the Social Security claiming decision. By delaying your benefits and securing a higher monthly payment, you establish a larger potential survivor benefit for your spouse. This can be a significant component of financial security for the surviving partner, providing a more robust income stream in the event of your passing.