Retired workers who start Social Security after full retirement age will get a bigger payout than those who claim early.
Social Security checks are the largest source of retirement income for most Americans, so current workers should aim to maximize their future payout. Among other considerations, that means thinking carefully about when to start Social Security. Claiming age is one of the most important factors in calculating retired-worker benefits.
In fact, retired workers who delay Social Security until age 70 could see up to $1,983 more per month compared to those who claim as soon as possible. Here are the details.
How claiming age affects Social Security retirement benefits
Workers can start collecting Social Security benefits at age 62, but they’re not entitled to their full benefit or primary insurance amount (PIA) until they reach full retirement age (FRA). Claiming earlier than FRA results in a permanent benefit reduction, meaning workers receive less than 100% of their PIA. But claiming later than FRA results in a permanent benefit increase, meaning workers receive more than 100% of their PIA.
How much more or less depends on exactly when benefits start. This calculator from the Social Security Administration can be tailored to individual circumstances. But all readers should be aware that delayed retirement credits stop accumulating at age 70, so it almost never makes sense to start Social Security any later. Doing so is simply leaving money on the table.
The chart below shows the relationship between birth year and FRA. It also shows the retired-worker benefit (as a percentage of PIA) for those who claim at age 62 and age 70. Recall that retired workers who claim Social Security at FRA will receive exactly 100% of their PIA.
