Love it or hate it, Social Security is a cornerstone of American retirement income. According to the Social Security Administration, almost 90% of Americans over 65 receive Social Security, and it represents a substantial portion of retirement income for the majority of elderly Americans.
It's also a very flexible way to get retirement income, since people can start getting a Social Security check as early as 62, or delaying as late as 70. The age you choose to start getting Social Security plays a big role in the size of your monthly benefit, and far too many Americans choose to start Social Security at the earliest age of 62. According to the most recent data, 32% of men and 37% of women filed as soon as they were eligible. The good news is the percentage has fallen in recent years, but the bad news is many of those who file early are making a mistake.
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Retirees are living longer (and filing early means a lot less money)
It may seem like the smart decision to file for Social Security early and get as many checks as you can before you die and not leave any "money on the table." However, most people would actually end up getting more money by putting off Social Security until their Full Retirement Age (between 66 and 67 for most current workers) or even after, versus claiming as soon as possible. The following table breaks down when the age you file and the age you die would result in the biggest total payout:
| Claiming Age: | 62 | 63 | 64 | 65 | 66 | 67 | 68 | 69 | 70 |
|---|---|---|---|---|---|---|---|---|---|
| Monthly benefit: | $750 | $800 | $866 | $933 | $1,000 | $1,080 | $1,160 | $1,240 | $1,320 |
| Total Benefit by Age | |||||||||
| 70 | $81,000 | $76,800 | $72,744 | $67,176 | $60,000 | $51,840 | $41,760 | $29,760 | $15,840 |
| 71 | $90,000 | $86,400 | $83,136 | $78,372 | $72,000 | $64,800 | $55,680 | $44,640 | $31,680 |
| 72 | $99,000 | $96,000 | $93,528 | $89,568 | $84,000 | $77,760 | $69,600 | $59,520 | $47,520 |
| 73 | $108,000 | $105,600 | $103,920 | $100,764 | $96,000 | $90,720 | $83,520 | $74,400 | $63,360 |
| 74 | $117,000 | $115,200 | $114,312 | $111,960 | $108,000 | $103,680 | $97,440 | $89,280 | $79,200 |
| 75 | $126,000 | $124,800 | $124,704 | $123,156 | $120,000 | $116,640 | $111,360 | $104,160 | $95,040 |
| 76 | $135,000 | $134,400 | $135,096 | $134,352 | $132,000 | $129,600 | $125,280 | $119,040 | $110,880 |
| 77 | $144,000 | $144,000 | $145,488 | $145,548 | $144,000 | $142,560 | $139,200 | $133,920 | $126,720 |
| 78 | $153,000 | $153,600 | $155,880 | $156,744 | $156,000 | $155,520 | $153,120 | $148,800 | $142,560 |
| 79 | $162,000 | $163,200 | $166,272 | $167,940 | $168,000 | $168,480 | $167,040 | $163,680 | $158,400 |
| 80 | $171,000 | $172,800 | $176,664 | $179,136 | $180,000 | $181,440 | $180,960 | $178,560 | $174,240 |
| 81 | $180,000 | $182,400 | $187,056 | $190,332 | $192,000 | $194,400 | $194,880 | $193,440 | $190,080 |
| 82 | $189,000 | $192,000 | $197,448 | $201,528 | $204,000 | $207,360 | $208,800 | $208,320 | $205,920 |
| 83 | $198,000 | $201,600 | $207,840 | $212,724 | $216,000 | $220,320 | $222,720 | $223,200 | $221,760 |
| 84 | $207,000 | $211,200 | $218,232 | $223,920 | $228,000 | $233,280 | $236,640 | $238,080 | $237,600 |
| 85 | $216,000 | $220,800 | $228,624 | $235,116 | $240,000 | $246,240 | $250,560 | $252,960 | $253,440 |
The green boxes indicate the future age when a particular claiming age generates the most dollars received. The red cells show which claiming age would result in the least dollars paid out.