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Making the Right Call: When to Collect Social Security Benefits

October 17, 2023

Social Security benefits play a crucial role in the financial well-being of millions of Americans. Deciding when to start collecting these benefits is a significant decision that can have a lasting impact on your retirement income. In this blog post, we will explore the three primary options for collecting Social Security benefits: collecting early at age 62, waiting until full retirement age (FRA), and delaying until age 70. We'll examine the benefits and drawbacks of each approach to help you make an informed decision about when to start receiving your Social Security benefits.

Collecting Early at Age 62

Benefits of Collecting Early

  1. Immediate Income: Collecting Social Security benefits at age 62 provides a source of immediate income, which can be crucial for retirees facing financial hardship or unexpected expenses.
  2. Longer Total Benefit Receipt: Early collection results in more total benefit payments over your lifetime compared to waiting until FRA or age 70.
  3. Flexibility: You have greater control over your finances, allowing you to use the additional income as you see fit or to invest in other opportunities.

Drawbacks of Collecting Early

  1. Reduced Monthly Benefits: The most significant drawback of collecting early is that your monthly benefit amount will be permanently reduced compared to waiting until your FRA. This reduction can be as much as 30%.
  2. Inadequate Income: Depending solely on reduced Social Security benefits may not provide enough income to cover your retirement expenses, especially if you live a long and healthy life.
  3. Impact on Spouse: If you have a spouse, collecting early may also reduce their potential spousal benefits, which could have long-term financial implications for both of you.

Waiting until Full Retirement Age (FRA)

Benefits of Waiting Until Full Retirement Age:

  1. Full Monthly Benefits: Waiting until your FRA ensures that you receive your full Social Security benefit amount, without any permanent reductions.
  2. Spousal and Survivor Benefits: You can maximize spousal and survivor benefits, providing greater financial security for both you and your spouse.
  3. Income Limits: At FRA, you can work and collect Social Security without facing potential penalties on your income over the set limit. This flexibility can be valuable if you wish to continue working during retirement.

Drawbacks of Waiting Until Full Retirement Age:

  1. Deferred Income: Waiting until FRA involves deferring your Social Security income, which may not be feasible for retirees who need immediate financial support.
  2. Opportunity Cost: By waiting, you forgo the benefits you could have received between age 62 and your FRA, which might have helped address immediate financial needs or opportunities.

Delaying Until Age 70

Benefits of Delaying Until Age 70:

  1. Maximum Monthly Benefits: Waiting until age 70 results in the highest possible monthly Social Security benefit, which can be advantageous for individuals with longer life expectancies.  Every year you wait, your benefit will increase by roughly 8%.
  2. Spousal and Survivor Benefits: The increased benefit amount also benefits your spouse, and they may receive a more substantial survivor benefit if you pass away.
  3. Tax Efficiency: Delaying Social Security can be a tax-efficient strategy because it allows you to draw down other retirement savings first, potentially reducing your tax liability.

Drawbacks of Delaying Until Age 70:

  1. Deferred Income: Delaying Social Security means deferring income for several years, which may not be suitable for retirees who need immediate financial support.
  2. Health and Longevity Uncertainty: If your health is compromised or you have a shorter life expectancy, waiting until age 70 may not result in a significant increase in total benefits, and you could miss out on years of potential benefits.


The decision of when to collect Social Security benefits is a complex one, as it involves balancing immediate financial needs with long-term financial security. While collecting early at age 62 offers immediate income and flexibility, it comes with the drawback of reduced monthly benefits. Waiting until full retirement age provides the advantage of working and collecting Social Security without income penalties, while delaying until age 70 offers maximum monthly benefits and potential tax advantages.

When making this decision, carefully evaluate your unique circumstances, financial goals, and life expectancy. Consulting a financial advisor or using online tools provided by the Social Security Administration can help you determine the optimal strategy for maximizing your Social Security benefits and securing your financial future in retirement. Remember that there is no one-size-fits-all answer, and the right choice will depend on your specific retirement plan and goals.