In the United States, the Social Security program allows workers to begin receiving benefits as early as age 62, but the age decision you choose forever affects the amount of money you will receive for the rest of your life.
Beneficiaries also have the option of waiting until they reach full retirement age (FRA), which ranges between 66 and 67, depending on the year of birth. Additionally, there is the possibility of delaying retirement until age 70, which can significantly increase the amount of benefits, to an amount that can exceed $5,000 in 2025.
You can apply for Social Security at different ages
Retiring at age 62 carries a significant payout disadvantage, as beneficiaries will receive approximately 30% less than if they had waited until full age. This option may be attractive to those who need immediate income or who do not plan to work anymore due to health or employment issues.
Now, opting for full retirement age offers full access to benefits without penalties that reduce the size of your check. This allows beneficiaries to enjoy an amount that best suits their financial needs and avoids the reductions associated with early withdrawal.
Finally, waiting until age 70 to begin receiving benefits provides a substantial increase in the monthly payment, which can be an additional 8% for each year delayed beyond full age. This option can be advantageous for those who maintain good health and may have a longer life expectancy, thus maximizing their income during retirement.
Social Security amounts: what happens if you delay or advance your retirement
According to the most recent information from the Social Security Administration (SSA), the average monthly benefit for retirees of all ages is approximately $1,925. However, this figure can vary considerably depending on the age at which a person decides to start their application for benefits. Below is how much more an individual could receive if they wait until age 67 instead of age 62.
If a worker applies before reaching full retirement age, their payments will be permanently reduced. The sooner you apply, the lower the monthly amount you will receive. For example, if a person has full retirement age at 67 and decides to start their claim at 62, they will experience a 30% decrease in their payments.
Average amounts for Social Security retirement payments
On average, those who wait until age 67 can expect a monthly increase of about $586 compared to if they had applied at age 62. According to 2023 data from the Social Security Administration, the average benefit for those who retire at age 62 is just $1,298, compared to about $1,884 for those who wait until age 67.
Additionally, if the application is delayed from the full retirement date, benefits may be increased even further. For those who reach age 67, waiting until age 70 to apply can result in a 24% increase on your total benefit. Thus, people who apply at age 70 could receive an average of about $2,038 a month in benefits.