Those who start collecting Social Security at an early age will get smaller benefits — but sometimes that’s the right thing to do.
As you plan for your retirement — and we all should be planning for our retirements, even if we’re still relatively young — it’s good to incorporate expected Social Security benefits, even if they’re just a rough estimate.
We can all start collecting our retirement benefits as early as age 62, and many of us would like that income as soon as possible. So here’s a look at the average benefits for those starting at 62 (and later ages) — and a discussion regarding when you might want to start collecting your benefits.
Social Security benefits basics
To be eligible for benefits, you need to earn a total of 40 credits, and you can earn up to four per year. The value of each credit is updated annually, and for 2024, it’s $1,730 in earnings. So for most workers, it’s fairly easy to qualify over a decade of working — because four credits in 2024 amounts to only $6,920 in earnings, and the bar has been similarly low in previous years.
How much you can collect is determined by the Social Security benefits formula, which incorporates these four key factors.
Length of working life
The formula bases its results on your earnings in the 35 years in which you earned the most. So to maximize your benefits, you’ll want to earn money for at least 35 years. (Each additional year you work will throw your lowest-earning year out of the calculations.)
Earnings history
The more you earn, the higher your benefits will be, up to a limit. The earnings cap is $168,600 for 2024, and it’s increased annually. Earning more than that in 2024 won’t result in higher future benefits.
Full retirement age
Each of us has a “full retirement age” at which we can start collecting the full Social Security benefits to which we’re entitled, based on our earnings history. For most of us, that age is 66 or 67. (It’s 67 for those born in 1960 or later.)
Claiming age
When you start collecting your benefits makes a big difference in their size. If you start collecting your benefits early, your benefit checks will be smaller (though you’ll collect many more of them). Delaying beyond your full retirement age will beef up your benefit checks by about 8% for each year until age 70.
Average Social Security benefits at different ages
So — what are retirees collecting from Social Security? Well, as of May 2024, the average monthly retirement benefit was $1,916.63 — or only about $23,000 per year. But that’s just an average. Much depends on those factors above. Here’s a look at the average benefit for beneficiaries of different ages as of the end of 2023:
| AGE | AVERAGE MONTHLY SOCIAL SECURITY BENEFIT (RETIRED WORKERS) | ANNUALIZED |
|---|---|---|
| 62 |
$1,298 |
$15,576 |
| 63 |
$1,339 |
$16,068 |
| 64 |
$1,460 |
$17,520 |
| 65 |
$1,563 |
$18,756 |
| 66 |
$1,740 |
$20,880 |
| 67 |
$1,884 |
$22,608 |
| 68 |
$1,948 |
$23,376 |
| 69 |
$1,945 |
$23,340 |
| 70 |
$2,038 |
$24,456 |
DATA SOURCE: SOCIAL SECURITY ADMINISTRATION. (SUMS ROUNDED TO NEAREST DOLLAR.)
For a more precise estimate of how much you can expect based on your earnings history, set up a my Social Security account at the Social Security Administration (SSA) website. Doing so will allow you to pop in to your account at any time to see the latest estimates of your future benefits.
Should you claim Social Security at 62 or later?
So — should you start collecting your own benefits early, on time, or late? That’s a vitally important question that you’ll have to answer for yourself. It’s smart to read up on the topic, and perhaps even to consult a financial advisor.
Here are some of the many considerations:
- If you stand a decent chance of living a shorter-than-average life, it can be smart to turn on the Social Security spigot early — and vice versa.
- If you simply need more income when you’re still in your early 60s, starting to collect early can be reasonable.
- For those who can delay, various studies suggest that delaying is often best. Per one study, United Income’s “The Retirement Solution Hiding in Plain Sight,” “79% of eligible adults in the sample claimed Social Security between 62-64 years old, even though it is only optimal for about 8% of adults to claim that early in their retirement. Instead, the most common optimal age to claim Social Security is 70 years old, when 57% of adults eligible for Social Security would have the best chance of affording retirement.”
- Starting off with a maximized benefit means that cost-of-living adjustments (COLAs), which occur in most years, will also be maximized.
- Married couples might want to maximize the higher earner’s benefits, because when one dies, the survivor will get to collect the higher benefit of the two.
So approach Social Security with your eyes open, and put a lot of thought into the decisions you make regarding it. It can make a big difference in your future financial security.
