When Is the Best Time to Begin Collecting Social Security Benefits?
Should you retire now and begin collecting your benefits, or hold off for a few more years? We get into it all below.
Katie TeagueWriter II
Katie is a writer covering all things how-to at CNET, with a focus on Social Security and notable events. When she's not writing, she enjoys playing in golf scrambles, practicing yoga and spending time on the lake.
ExpertisePersonal Finance: Social Security and taxes
A recent graduate of the University of Minnesota, Nina started at CNET writing breaking news stories before shifting to covering Security Security and other government benefit programs. In her spare time, she's in her kitchen, trying a new baking recipe.
You don't have to wait until you hit 67 to begin collecting your Social Security benefits. Yes, the full retirement age is currently 67, but you can begin collecting benefits as early as 62.
When you decide to start collecting your Social Security benefits is something that can affect your finances for the rest of your life. And with the big cost-of-living adjustment increase that arrived in 2023, you might want to know whether it's a good idea to start collecting your benefits now. We'll answer all those questions and more below.
There are advantages and disadvantages, whether you decide to retire early or wait a few more years. The best place to start your decision is by examining your current financial situation, including any other money you've saved over the years through your 401(k), IRA or other retirement investments to determine what's best for you.
We spoke with an expert and took the Social Security Administration's advice into consideration to help you determine the best time to collect your benefits. For more about Social Security, learn how you can pause payments to get more money later.
If you are a spouse or ex-spouse of someone who has contributed to Social Security through taxes, you may be able to claim part of their benefits. You can either choose to receive that share or a payout based on your own work history, depending on whichever amount is greater.
When should you start collecting Social Security benefits?
The earliest you can start receiving your Social Security benefits is at age 62 -- though you'll receive a smaller amount than if you wait. If you do wait until full retirement age (67 or later for those born in 1960 or later), you can collect more money -- but over fewer years. However, everyone's situation is different. The Social Security Administration says "there's not a single 'best age' for everyone and, ultimately, it's your choice."
Katherine Tierney, senior retirement strategist of client needs research at financial services firm Edward Jones, suggests asking yourself these questions: When do you want to retire and when can you afford to retire?
Looking at when you can afford to retire depends on the lifestyle you want, as well as where you'll live when retired, Tierney said. It also depends on how much you've got saved for retirement and how much you've contributed to your 401(k). You should also consider if you'll have other forms of income in retirement, such as a part-time job or a pension. Your health and life expectancy are also other factors to consider.
Should you wait until you're older to get a bigger payout? Or retire early with a smaller payout?
Deciding whether to retire early and claim your benefits sooner or wait a few more years might be a question on your mind if you're close to retirement age.
"Social Security can act as insurance against living longer than you anticipate, and it provides some inflation protection since your benefit is adjusted for cost-of-living increases," Tierney said. "The longer you or your spouse expect to live, the more it may make sense to wait to claim your Social Security benefit."
But just because you decide to wait to claim your benefits doesn't mean you have to delay your retirement, she explained. However, you should make sure you've got income coming in from your 401(k) or other investments so you can afford your living expenses if you delay claiming your benefit.
However, if you're solely relying on Social Security benefits to pay for your expenses in retirement, waiting to retire and claiming your benefits at a later date could be a better choice. You'll receive more money each month and you'll have more time to save for retirement.
Also, if you choose to retire early, your benefits will be reduced for each month before full retirement age. For instance, if you were born in 1960 or later and retire at age 62 with a retirement benefit of $1,000 per month, your payment would be reduced to $700 (or a 30% reduction).
On the plus side, that's still $700 you would otherwise not receive during that time if you didn't draw your Social Security benefits. So you might benefit from collecting payments over a longer period of time.
If you retire early, could you potentially run out of money?
While you won't run out of Social Security benefits (though there's a chance benefits could drop by 20% by 2032), you could exhaust your 401(k) or other retirement savings. However, you can help prevent that by being conservative with your withdrawal rate if you retire early, Tierney said.
She recommends regularly monitoring your spending and 401(k) withdrawal rate so you don't outlive your assets. Forgoing an annual spending increase or reducing spending -- especially when the market is down or inflation is high, like we're experiencing now -- can help avoid depleting your retirement savings.