When Should You Take Social Security? The Math Behind the Decision

retirement 2026-02-27 · 5 min read Social Security when to take Social Security retirement income Social Security benefits retirement planning

Social Security timing is one of the highest-stakes financial decisions most Americans will make. The difference between claiming at 62 vs. 70 can exceed $100,000 in lifetime benefits — or it can go the other way, depending on how long you live.

How Social Security Benefits Work

Your Social Security benefit amount is based on your 35 highest-earning years, indexed for inflation. This is your "primary insurance amount" (PIA).

The SSA calculates your PIA for your "full retirement age" (FRA):

Born 1943-1954: FRA is 66
Born 1955-1959: FRA is 66 plus 2-10 months
Born 1960 or later: FRA is 67

The Age Range: 62 to 70

You can start claiming anytime between 62 and 70. Each year you wait changes the benefit amount:

Claiming before FRA (early claiming): Benefits are permanently reduced. For those with FRA of 67:

At 62: benefits are ~30% lower than at FRA
At 63: ~25% lower
At 64: ~20% lower
At 65: ~13.3% lower
At 66: ~6.7% lower
At 67 (FRA): 100% of benefit

Waiting beyond FRA (delayed credits): Benefits increase 8% per year past FRA until 70.

At 68: ~108% of FRA benefit
At 69: ~116% of FRA benefit
At 70: ~124% of FRA benefit

The Break-Even Analysis

The core question: at what age do you break even between claiming early (more years of lower payments) vs. claiming late (fewer years of higher payments)?

Example: $2,000/month at FRA (67) vs. $2,480/month at 70 (24% more)

The person who claims at 70 receives $480/month more but gives up 3 years of payments:

3 years × $2,000/month = $72,000 foregone
Annual extra from waiting: $480 × 12 = $5,760/year
Break-even: $72,000 ÷ $5,760 = 12.5 years past age 70 = age 82.5

If you live past 82-83, waiting to 70 pays off financially. If you die earlier, claiming earlier was better.

The average American life expectancy at 65 is approximately 84-85. But life expectancy at 65 varies significantly based on health status, and averages mask the distribution.

The Key Variables

Your Health and Life Expectancy

This is the dominant factor. If you:

Are in excellent health with no major chronic conditions → consider waiting
Have serious health problems or family history of early death → early claiming may make sense
Have a family history of longevity → waiting to 70 likely pays off

The Social Security Administration has tools to help estimate your expected benefits at ssa.gov/myaccount.

Your Other Income Sources

If you have substantial retirement savings (401k, IRA, pension), you may be able to bridge the gap between retirement and age 70 by drawing from savings — allowing Social Security to grow. This "social security bridge" strategy is often mathematically optimal.

If you have no other income source and must work until you claim, claiming earlier may be necessary.

Spousal Considerations

Social Security has complex spousal benefits. Some key rules:

Spousal benefit: A non-working or lower-earning spouse can claim up to 50% of their partner's FRA benefit (not the delayed benefit amount — just FRA).

Survivor benefit: When one spouse dies, the surviving spouse keeps the higher of the two benefits. This makes the higher earner's decision about when to claim especially important — the survivor may collect that benefit for decades.

If one spouse is a higher earner with good health, maximizing their benefit by waiting to 70 is often the right call even if the lower-earning spouse claims earlier.

Divorced spouses: If you were married for 10+ years and divorced, you may be entitled to spousal benefits on your ex's record — especially if their benefit is higher than yours.

Working While Receiving Early Benefits

If you claim before FRA and continue working, your benefits are temporarily reduced:

Under FRA: $1 reduction for every $2 earned above $22,320 (2024 limit)
Year you reach FRA: $1 reduction for every $3 earned above $59,520

Importantly, these aren't permanent — they're credited back once you reach FRA, resulting in a higher monthly benefit going forward. But it complicates the decision for people who retire early but continue earning some income.

Common Scenarios

Scenario 1: Claim at 62

Best if:

You have a serious health condition
You desperately need the income
You have little other retirement savings and cannot work longer
Your spouse has a significant benefit and you're the lower earner

Scenario 2: Claim at FRA (67)

Reasonable middle ground if:

You're in average health
You've retired but have some savings to supplement
Spousal dynamics don't strongly favor one strategy

Scenario 3: Delay to 70

Likely optimal if:

You're in good health with parents/siblings who lived long lives
You can afford to wait (other income sources or continued part-time work)
You're the higher earner in a couple (survivor benefit consideration)
You want to maximize inflation protection — Social Security has COLAs (cost-of-living adjustments)

The COLA Factor

Social Security benefits receive annual cost-of-living adjustments (COLAs) tied to inflation. A higher base benefit means larger absolute dollar increases from COLAs over time.

In 2023, the COLA was 8.7%. On a $2,000/month benefit, that's $174/month more. On a $2,480/month benefit, that's $216/month more. The gap between early and late claiming widens over time.

Tools for Modeling Your Decision

SSA.gov: Create a "my Social Security" account to see your actual earnings history and benefit estimates at various ages.

Open Social Security (opensocialsecurity.com): Free tool that calculates optimal claiming strategy for individuals and couples based on your specific numbers.

Maximize My Social Security: More comprehensive paid software used by financial advisors.

Running these numbers with your actual Social Security history makes this decision much clearer than working from averages.

The Tax Consideration

Up to 85% of Social Security benefits can be taxable federal income depending on your "combined income" (AGI + half of SS benefits). Careful planning around what year you claim can affect how much of your benefit you keep.

Roth conversions in the years before claiming Social Security — when your income is lower — can reduce future tax on benefits by lowering the taxable portion of Social Security when you do claim.

For most people, claiming Social Security at 70 with adequate savings to bridge the gap is the mathematically optimal strategy. The longevity insurance aspect — knowing you'll have a higher guaranteed income if you live to 90+ — has real value beyond the expected value calculation.