Social Security Matters: When should you retire?

Posted 11/29/20

Dear Rusty: I’m almost 59 and hope to retire from working soon.

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Social Security Matters: When should you retire?


Dear Rusty: I’m almost 59 and hope to retire from working soon. Should I take Social Security as soon as possible, or wait for the maximum amount? Signed: Planning Ahead

Dear Planning Ahead: I’m afraid there’s no simple answer to your question, except “it depends.” It depends on your health; it depends on your need for the money when you retire; and it depends on your life expectancy. Plus, your marital status may also influence your decision on when to claim.

First of all, you cannot claim your Social Security retirement benefit until you are at least 62 years old. But if you claim at 62 your benefit will be cut by 30% from what it would be if you waited until your full retirement age (67). You actually have an eight-year window starting at age 62 and lasting until age 70 to claim your Social Security benefit. The earlier in that window you claim, the smaller your benefit will be. And the longer you wait to claim (up to age 70), the higher your benefit will be.

At age 70, your benefit will reach maximum at 24% more than it would be at age 67, and 76% more than it will be at age 62. Essentially, if you are in good health, don’t urgently need the money earlier, and expect to enjoy at least “average” longevity (about 85 for a man your age today), you will not only get a much higher monthly benefit, but also collect much more in cumulative lifetime benefits by waiting until age 70 (or as long as you can) to claim. Of course, no one knows how long they will live, but there are online tools which can assist you with estimating your life expectancy. One relatively simple and user friendly tool is available from Social Security at this link:

Conversely, if you are not in good health and don’t expect at least average longevity, or if you urgently need the money when you retire from working, claiming earlier may also be a prudent choice. If you are married and you predecease your wife, her survivor benefit will be based upon the benefit amount you are actually receiving, so by waiting to get a higher benefit for yourself you are also enhancing your wife’s eventual benefit as your widow, should you pass before her.

Be aware too that, should you decide to go back to work, until you reach age 67 you’ll be subject to Social Security’s “earnings test” which limits how much you can earn before Social Security takes back some of your benefits (the 2021 limit is $18,960 and if that were exceeded, they’d take back benefits equal to half of the amount it was exceeded by). The earnings limit changes annually but goes away at your full retirement age.

So, these are the things you should consider in deciding when in that eight-year window to claim your benefits. I cannot directly answer your question for you, but I hope the above gives you what’s needed to make an informed decision on when to claim your Social Security benefits.