The Biggest Social Security Mistake You’re Likely to Make

You can claim Social Security benefits at age 62, but that doesn’t mean you should.

The longer you wait, the more you get — and we’re not talking peanuts, either.

“Checks claimed at age 62 are about 25 percent smaller than if you wait until your full retirement age,” CNNMoney says. That’s 67 for those born in 1960 or later, and a bit younger for those who were born earlier. You can find your full retirement age here.

Benefits keep growing after full retirement age, too, by 8 percent for each year you wait until age 70, CNNMoney says. They offer the example of a hypothetical 61-year-old making $55,000. A few scenarios:

  • She starts claiming benefits at 62, getting about $15,400 a year.
  • She starts at 66, which is her full retirement age, and gets $20,500 a year.
  • She starts at 70, and gets $27,100 a year.

If she lives until age 95, the difference between claiming at 62 and 70 is $177,000 in today’s dollars. That’s on top of the additional earnings she could make by continuing to work those eight years, plus the health benefits of working longer. Delaying retirement is said to reduce the risk of dementia.

Health issues or unemployment could take away that option, of course, and it may be hard to see that far into the future. So check out the video below for several other ways to boost your Social Security income:

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  • Terry Sanders

    Mr Ballanger is pushing the same fallacy I hear from many alleged ‘financial experts’. Fortunately for me, I had the advice of an actuary who brought to my attention the fact that, if I didn’t take early SS payments, I would be failing to get that yearly $15,400 for another 8 years. That comes to $123,200. Do you know how long it would take you to make up for that money before your ‘larger’ payment from delaying SS would even out and actually give you more money? How many of you plan on living to be a hundred?

    Not to mention the fact of having to endure another 8 years of the increasing anxiety and humiliation that keeping a job in America entails.

  • Kent

    Social Security is setup so that if you live until the average life expectency of 77 years, you get the same amount of money no matter when you start taking it. If you think you will live longer than that you are better off taking it later. If you don’t think you will live that long you are better off taking it earlier.

  • Bob Williams

    I agree that everyone should take it at 70 or later. Make it much more secure for me.