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Deciding when to start receiving Social Security benefits is one of the most critical financial decisions you’ll make in retirement. It’s a choice that can significantly impact your lifetime income and overall financial security. There’s no one-size-fits-all answer, as the optimal claiming age depends on a myriad of personal factors, from health and life expectancy to current financial needs and spousal considerations.

At Figeroux and Associates, located at 26 Court Street, Suite 701, Brooklyn, New York, 11242, with website www.askthelawyer.us, and phone number 855-768-8845, we provide comprehensive guidance on Social Security claiming strategies, recognizing the complexities and uniqueness of each individual’s circumstances. This article will walk you through the essential steps and considerations for making this crucial decision.

What is Social Security?

Social Security is a federal insurance program that provides retirement, disability, and survivor benefits. It’s funded through payroll taxes – a portion of your earnings (and your employer’s contributions) goes into the system throughout your working life, accumulating “work credits.” To qualify for retirement benefits, most individuals need to have earned 40 work credits, typically accumulated over at least 10 years of work. Your benefit amount is primarily based on your average indexed monthly earnings during your 35 highest-earning years.

Social Security is not a retirement account in the traditional sense, but rather a guaranteed income stream designed to provide a baseline of financial support in retirement.

Deciding the Best Time to Claim Social Security Benefits

The Social Security Administration (SSA) offers a window for claiming retirement benefits, starting as early as age 62 and extending up to age 70. Your “Full Retirement Age” (FRA) is a key benchmark in this decision-making process.

What is Full Retirement Age (FRA)?

Your Full Retirement Age is the age at which you are entitled to receive 100% of your primary Social Security benefit. This age is determined by your birth year:

• Born 1943-1954: FRA is 66.
• Born 1955: FRA is 66 and 2 months.
• Born 1956: FRA is 66 and 4 months.
• Born 1957: FRA is 66 and 6 months.
• Born 1958: FRA is 66 and 8 months.
• Born 1959: FRA is 66 and 10 months.
• Born 1960 or later: FRA is 67.

For example, if you were born in June 1959, your Full Retirement Age is 66 years and 10 months. You would reach this age in April 2026. If you were born in January 1960, your FRA is 67, which you would reach in January 2027.

The Consequences of Claiming Social Security Early or Late

The age at which you claim directly impacts the amount of your monthly benefit.

Claiming Early (Before FRA)

You can begin receiving Social Security retirement benefits as early as age 62. However, claiming before your FRA results in a permanent reduction in your monthly benefit. The reduction is calculated based on the number of months you claim before your FRA.

• Reduction Rate: For each month you claim early, your benefit is reduced by 5/9 of 1% for the first 36 months, and then by 5/12 of 1% for each additional month.
• Maximum Reduction at Age 62 (for FRA of 67): If your FRA is 67, claiming at age 62 means your benefit will be permanently reduced by approximately 30%. For example, if your FRA benefit (Primary Insurance Amount, or PIA) is $2,000 per month, claiming at 62 would reduce it to around $1,400 per month.
• Impact of Working: If you claim benefits before your FRA and continue to work, your benefits may be subject to an earnings test. For 2025, if you are under FRA for the entire year, $1 in benefits will be deducted for every $2 you earn above $23,400. In the year you reach FRA, the reduction is $1 for every $3 earned above a higher limit ($62,160 in 2025), but only on earnings before the month you reach your FRA. For instance, if you claim at 64 with an FRA of 67, and you earn $30,000 in 2025, the excess earnings ($30,000 – $23,400 = $6,600) would result in a $3,300 reduction ($6,600 / 2) in your annual benefits.

Why claim early? Some individuals choose to claim early due to immediate financial need, health issues that may limit their life expectancy, or the desire to retire sooner.

Claiming Late (After FRA)

Delaying your Social Security benefits beyond your FRA can significantly increase your monthly payment. This increase comes in the form of Delayed Retirement Credits (DRCs).

• Credit Rate: For each full year you delay claiming benefits beyond your FRA, up to age 70, your benefit increases by 8% per year.
• Maximum Increase at Age 70 (for FRA of 67): If your FRA is 67, delaying until age 70 can result in a permanent increase of 24% (3 years x 8%) over your FRA benefit. For example, if your FRA benefit is $2,000 per month, waiting until 70 would boost it to $2,480 per month.
• No Earnings Test: Once you reach your FRA, there is no limit on how much you can earn while receiving Social Security benefits.

Why claim late? Delaying benefits often makes sense for individuals who are in good health and expect to live a long life, have other sources of income to cover expenses in their early retirement years, or want to maximize survivor benefits for a spouse.

Considering Your Unique Case

The optimal claiming strategy is highly personal and requires a careful analysis of several factors:

1. Life Expectancy: This is arguably the most crucial factor. If you expect to live well into your 80s or beyond (e.g., due to good health, family history of longevity), delaying benefits typically yields more in total lifetime benefits. If you have a shorter life expectancy (e.g., due to chronic illness), claiming early might make more sense to receive benefits for more years.
2. Current Financial Needs and Other Income Sources: Do you need the income now to cover living expenses, or do you have sufficient savings, pensions, or other retirement income to defer Social Security? If you have substantial assets in a 401(k) or IRA, you might consider drawing from those accounts first to allow your Social Security benefit to grow.
3. Marital Status and Spousal Benefits: If you are married, your claiming decision impacts your spouse. A spouse may be eligible for benefits based on your earnings record. If you claim early and reduce your benefit, you also reduce the potential spousal benefit. Furthermore, if you pass away first, your surviving spouse may receive a survivor benefit based on your earnings. Delaying your claim to grow your own benefit also increases the potential survivor benefit for your spouse. For example, if a higher-earning spouse delays claiming until 70, the surviving spouse could receive a significantly larger monthly payment upon their death. 
   • Divorced Spouses: You may be able to claim benefits on a former spouse’s record if the marriage lasted at least 10 years, you are currently unmarried, and you are age 62 or older. This can be a strategic option even if your ex-spouse has remarried.
4. Work Plans: Do you plan to continue working part-time or full-time into your 60s? The earnings test could significantly reduce your benefits if you claim early while working.
5. Health and Healthcare Costs: Consider potential future healthcare expenses. A higher guaranteed Social Security income can provide a stronger financial cushion.

Why Consulting with an Attorney is Highly Recommended

Given the complexities and unique nature of each case, consulting with an experienced attorney specializing in retirement and elder law is highly recommended. While the Social Security Administration provides information, they cannot offer personalized advice tailored to your specific financial situation and goals. An attorney from Figeroux and Associates can:

• Perform a Personalized Analysis: We will analyze your complete financial picture, including your earnings history, other retirement assets, health status, and family situation, to project different claiming scenarios and their long-term impact.
• Maximize Lifetime Benefits: We can help you identify strategies to maximize your total lifetime Social Security benefits, not just your initial monthly payment. This might involve intricate coordination strategies for married couples, like “file and suspend” (though largely eliminated, some older rules might still apply in very specific cases) or “restricted application” for spousal benefits.
• Navigate Complex Rules: Social Security rules are intricate, with various provisions for spousal benefits, survivor benefits, disability benefits, and the earnings test. An attorney understands these nuances and can advise on how they apply to your situation. For instance, if you are eligible for both your own retirement benefit and a survivor benefit, an attorney can help you determine which one to claim first to maximize your overall benefit.
• Integrate with Overall Financial Planning: Your Social Security claiming decision should be part of a broader retirement plan. We can help you integrate your Social Security strategy with your investment portfolio, tax planning, and estate planning goals.
• Address Unique Circumstances: Whether you’re divorced, widowed, caring for a disabled child, or have specific health concerns, an attorney can advise on how these unique factors influence your optimal claiming strategy. For example, if you are a widowed individual, claiming survivor benefits early might be a good strategy to allow your own retirement benefit to grow until age 70.
• Provide Peace of Mind: The decision of when to claim Social Security can be overwhelming. Professional guidance provides clarity and confidence, ensuring you make an informed choice that aligns with your financial well-being.

Conclusion

The decision of when to claim Social Security benefits is a deeply personal one with long-lasting financial consequences. While claiming early at age 62 offers immediate income, it comes with a permanent reduction. Conversely, delaying until age 70 can significantly boost your monthly payments for the rest of your life. Your Full Retirement Age is the critical pivot point, determining whether your benefit is reduced, remains at 100%, or is increased.

Don’t leave hundreds of thousands of dollars on the table due to an uninformed decision. The complexities of Social Security, combined with the uniqueness of your financial and personal situation, highlight the importance of expert legal advice. Contact Figeroux and Associates today at 855-768-8845 or visit www.askthelawyer.us to schedule a consultation. Our experienced team can help you analyze your options and develop a tailored Social Security claiming strategy to secure your financial future in retirement.

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