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Should I collect Social Security benefits before I turn 70?

Millions of Americans collect Social Security benefits, but the age you retire has a direct impact on the amount you’ll receive.

social security benefits application for monthly benefit payment

Retiring as early as you can at age 62 could cost you up to 30% of your overall benefits.

Retiring at your full retirement age will grant you 100% of your full benefits.

Your full retirement age to collect Social Security depends on the year you were born.

The following years of birth have different FRAs

  • 1943-54: Age 66
  • 1955: Age 66 and two months
  • 1956: Age 66 and four months
  • 1957: Age 66 and six months
  • 1958: Age 66 and eight months
  • 1959: Age 66 and ten months
  • 1960 and later: Age 67

However, if you wait until age 70, you’ll see a benefit boost for each year between 67 and 70.

Once you reach age 70, there’s no point in waiting any longer because your benefits will not increase anymore.

Is Social Security really unable to pay full benefits in 2035? It could actually expand in the long run as COLA increases happen in the short term

How are your Social Security benefits decided?

Aside from your age, you salary and 35 highest earning years determine the size of your monthly benefit.

The maximum benefit anyone will see in 2022 is $4,194.

In order to make that, you must make the tax cap for 35 years.

In 2022 the wage cap is $147,000, meaning once you make more than that, you’ll no longer pay into Social Security for the year.

If you wait until age 70, opposed to 62 or 67, the difference may not be as big as you think.

The Daily Nonpareil gave the following example.

If you were born in 1975 and make $100,000, your expected monthly benefits depending on retirement age are as follows

  • Age 62: $1,901 monthly payment with $410,600 collected by age 80
  • Age 67: $2,766 monthly payments with $431,500 collected by age 80
  • Age 70: $3,474 monthly payments with $416,800 collected by age 80

The difference in benefits you’re looking for won’t become noticeable until you enter your 80s.

By then, it may not have been worth it.

When to collect benefits always depends on the individual and their situation.

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