You can start receiving Social Security benefits as soon as you turn age 62, but the longer you wait, the higher your benefits will be — up to a limit.
Waiting until full retirement, which is age 66 or 67 depending on when you were born, lets you get your full benefits. Waiting until after that boosts your checks even more via delayed retirement credits. However, those credits don’t accumulate forever, and waiting to claim Social Security after your 70th birthday means you are leaving money on the table. Here’s how to get the maximum benefit without losing several months or years of elevated checks.
How delayed retirement credits actually work
Delayed retirement credits refer to the additional benefits that accumulate if you wait until after full retirement age to claim benefits. Anyone who was born in 1960 or later reaches full retirement age at 67. Those born earlier have their retirement age somewhere between age 66 and 67, with the exact age depending on their birthday.
Delayed retirement credits start to build when you turn 66 or 67, and they will grow each month until you turn 70, as long as you do not claim Social Security benefits in the meantime. You get the highest possible benefit if you wait to claim them upon turning 70. However, there is no incentive to wait beyond 70 since your benefits will not accumulate, and you are missing out on free checks.
Delaying your access to Social Security isn’t the only way to boost your benefits. The Social Security Administration (SSA) considers a worker’s earnings history when calculating the total benefit. If you work a few more years and earn a high annual salary, those earnings can replace lower-earnings years. Social Security looks at your 35 highest-earning years when calculating your benefit, so you can influence your total benefit in other ways than just waiting out for your 70th birthday.
The ‘apply at 70’ trap and why filing later can cost you
Although 70 is the magic number when you get the maximum Social Security benefit, that doesn’t mean you should wait until 70 to apply. It can take up to six weeks after you apply to start receiving your benefits, according to the National Council of Aging, and you will also have to create a Social Security account via the SSA.
But you can plan ahead so that you don’t miss out on any checks. The SSA lets you time your first payment. This feature lets you apply for Social Security benefits months in advance and specify that you receive your first benefit right when you turn age 70.
“If you’ve already reached full retirement age, you can choose to start receiving benefits before the month you apply,” the SSA says. “However, we cannot pay retroactive benefits for any month before you reached full retirement age or more than six months in the past.”
What retirees should do before and around age 70
There’s still time to plan between now and age 70. You should set up a Social Security account and see how your benefit will change based on when you start receiving benefits.
While you get the maximum benefit if you wait until 70, it may make sense to take it out earlier due to finances, health, marital status, if you are still working and other factors. The decision to claim is a bit more complex for married couples. It’s often optimal for the higher-earner to wait until 70 to maximize the survivor benefit, while claiming the lower-earning spouse’s benefits early if you need the checks to help cover costs. And don’t forget about Medicare: You can still sign up at age 65 even if you delay your Social Security benefits.
