When to Take Social Security (The Timing Decision That Could Cost You Thousands)
The decision of when to start taking Social Security could be worth tens of thousands of dollars over your lifetime—or hundreds of thousands if you live long enough.
And most people get it wrong. Not because they’re bad at math, but because they make the decision reactively instead of strategically.
I’ve seen this pattern a thousand times: someone turns 62, sees a Reel or an Instagram post saying they should take Social Security as early as possible, and they grab it. Then they realize they’re going to keep working. Now they’re asking me, “What’s going to happen? Is it going to destroy my benefits? I was planning on the full amount.”
The answer is usually: you’d have been better off waiting. But it’s not too late to plan forward.
My general position: take it as late as you can. But this isn’t one-size-fits-all. The right timing depends on your situation—and there’s no shame if you need to take it early. Let me walk you through the math, the strategy, and the framework for making this decision.
First, the math. This is the part most people don’t fully understand.
If you were born in 1960 or later, your full retirement age (FRA) is 67. That’s when you get 100% of your calculated benefit. But you can start as early as 62 or wait as late as 70.
Here’s what happens at each age. Let’s use a $2,000 monthly benefit at full retirement age as our example. If you claim at 62, you get 70% of that—$1,400 a month. At 63, it’s 75%, or $1,500. At 64, you’re at 80%, which is $1,600. At 65, it’s 86.7%—$1,734. At 66, you’re at 93.3%, or $1,866. At 67, your full retirement age, you get the full $2,000.
But here’s where it gets interesting. If you wait past 67, your benefit keeps growing. At 68, you’re at 108%—$2,160 a month. At 69, it’s 116%, or $2,320. And at 70, you max out at 124%—$2,480 a month.
Look at the spread. Taking it at 62 means $1,400 a month. Waiting until 70 means $2,480 a month. That’s 77% more—for the rest of your life.
These reductions and increases are permanent. If you claim at 62 and get the 30% reduction, that reduction stays with you forever. If you wait until 70 and get the 24% bonus, that bonus stays with you forever.
Now, the break-even question—and why it’s the wrong way to think about this.
People always want to know: “If I wait, when do I break even?” It’s a natural question. You’re giving up years of checks by waiting, so at what point does the higher monthly amount make up for it?
The math usually puts break-even somewhere around age 80-83, depending on whether you’re comparing 62 to 67 or 62 to 70.
Here’s the problem: break-even analysis assumes you’d be equally happy running out of money at 83 and at 95. You wouldn’t be.
We can’t predict how long we’re going to live. And in the absence of being able to predict that, the question isn’t “will I beat the break-even?” It’s “what happens if I live a long time?”
Social Security is longevity insurance. The value isn’t just the monthly check—it’s the guarantee that the check keeps coming no matter how long you live. If you take it early and live to 95, you’ve locked in that reduced benefit for 33 years. If you wait until 70 and live to 95, you get the maximum benefit for 25 years.
Generations are living longer. Many financial planners say look at when your parents died—but our generations are getting older later and needing more help for longer. Planning for a short life when you might live a long one is a costly mistake.
Here’s the strategy I recommend: think about the order you tap your accounts.
If you have multiple retirement resources—401(k), traditional IRA, Roth IRA, Social Security—the order you use them matters for both taxes and total lifetime wealth.
My recommended sequence:
First: 401(k) and traditional IRA. These are the accounts with Required Minimum Distributions. Starting at age 73, you’re going to have to take money out whether you want to or not. Using these accounts first lets your Social Security benefit keep growing (8% per year between FRA and 70). It also reduces your future RMD burden.
Second: Social Security. Start taking it after you’ve drawn down some of your RMD-required accounts—or at 70 at the latest, since there’s no benefit to waiting past 70.
Third: Roth IRA. This is your most flexible account. No RMDs, tax-free withdrawals, easiest to pass to the next generation. Let it grow as long as possible.
Why this order works: You maximize the growth of your largest guaranteed asset (Social Security), reduce your taxable income in early retirement, and preserve your most flexible asset for last. It also creates better tax planning opportunities throughout.
What if you’re still working? This is where people get tripped up.
If you claim Social Security before your full retirement age and keep working, there’s an earnings test. Earn too much, and some of your benefits get withheld.
Here’s how it works in 2026. If you’re under full retirement age for the entire year, the earnings limit is $24,480. Earn more than that, and $1 gets withheld from your Social Security for every $2 you earn over the limit. In the year you reach full retirement age, the limit jumps to $65,160 for the months before your birthday, and the withholding drops to $1 for every $3 over. Once you hit full retirement age, there’s no limit—earn whatever you want with no reduction.
Important: Only earned income counts—wages and self-employment. Not investment income, pensions, rental income, or IRA withdrawals.
Also important: This isn’t actually a permanent penalty. The withheld benefits aren’t lost forever. Once you reach FRA, your monthly benefit is recalculated upward to credit back the months that were withheld. But it takes years to recover, and you’re dealing with smaller checks in the meantime.
Here’s the scenario I see constantly: Someone takes Social Security at 62 and gets $1,400 a month. Then they realize they’re going to keep working and earn $50,000 a year. They’re about $25,500 over the $24,480 limit. Half of that—$12,750—gets withheld from their Social Security over the year. Their $1,400 monthly benefit effectively becomes about $335 a month after withholding.
If you’re going to keep working and earning significantly above the limit, why claim early and deal with this? Just wait.
There’s also the tax question. Up to 85% of your Social Security benefits can be subject to federal income tax, depending on your other income.
The formula uses “combined income”: your adjusted gross income plus nontaxable interest plus half of your Social Security benefits. If that total exceeds $34,000 (single) or $44,000 (married filing jointly), up to 85% of your Social Security becomes taxable.
This interacts with your retirement account withdrawals. Traditional IRA and 401(k) withdrawals count as income. Roth withdrawals don’t. This is another reason the withdrawal order matters—if you’re pulling heavily from traditional accounts while also collecting Social Security, you may be pushing more of your Social Security into the taxable zone.
Now let’s talk about when taking it early actually makes sense. Because it’s not always wrong.
Everyone is different. In some cases, people may be absolutely panicked and feel they have to take it—and that’s OK. They shouldn’t be shamed. The question then becomes: now what do you do with it?
Situations where early claiming may be right:
You have no other income source. If you’ve lost your job and Social Security is the only way to pay bills, take it. Survival comes first.
Serious health issues. If you have conditions that significantly reduce your life expectancy, the break-even math changes. Someone with a terminal diagnosis shouldn’t wait until 70.
You physically can’t work. Some jobs—physical labor, demanding schedules—people simply can’t do into their late 60s. If you can’t work, you can’t work.
You genuinely need the money. No retirement savings, no other income, bills to pay. Take it.
But even then: Consider whether you can bridge with part-time work or modest savings to delay just a year or two. Each year you wait between 62 and FRA avoids roughly 6-7% in permanent reduction. Each year between FRA and 70 adds 8%. Small delays can make meaningful differences.
What if you already took it early?
If you’re within 12 months of starting benefits, there’s a “do-over” option: withdraw your application and repay all benefits received, then start fresh later. This is rarely practical because you have to come up with all that money at once.
If you’ve passed FRA, you can voluntarily suspend your benefits. They’ll grow by 8% per year until you turn 70 or restart them. This doesn’t fully undo an early claiming decision, but it helps.
Mostly, if you took it early, you live with it. That’s OK—Social Security is still valuable, just less valuable than it would have been. Focus forward: understand how working affects your current benefits, plan your other withdrawals strategically, and don’t compound one suboptimal decision with more.
Here’s the framework for making this decision.
Ask yourself:
Can I wait? Do I have enough from other sources—401(k), savings, part-time work—to delay Social Security while it grows?
Will I keep working? If yes, will my earnings exceed the earnings test limits? If so, waiting makes more sense.
What’s my health outlook? Any serious conditions that might significantly shorten life expectancy?
Am I married? Spousal and survivor benefits may change the optimal strategy. (More on that in a future post.)
What’s my backup plan? If I wait and something goes wrong financially, what do I do?
The biggest thing to weigh: how far can you get with your existing accounts? If you don’t have much saved and Social Security is what’s going to make the difference, then take it. If you plan to keep working and don’t really need the Social Security yet, why not hold off and get the bigger benefit by waiting?
My personal plan, at 54: wait as long as humanly possible to take it.
Your action items:
Before you decide anything: Go to ssa.gov/myaccount and look at your projected benefits at 62, 67, and 70. See the actual numbers for your situation. The difference may be larger than you expect.
If you’re still working and considering claiming: Calculate whether your earnings will trigger the earnings test. If you’re going to lose half your benefits to withholding anyway, waiting starts looking a lot better.
If you’re married: Don’t make this decision in isolation. Spousal and survivor benefits add complexity—and often change the optimal strategy significantly. We’ll cover that next.
If you already claimed early and are still working: Don’t panic. The withheld money isn’t lost forever—it gets credited back at FRA. But do understand how the earnings test affects you so you can plan accordingly.
So where does this leave you?
The timing decision is one of the biggest financial choices you’ll make in retirement. For most people who can afford to wait, the math favors waiting. You’re trading smaller checks now for larger checks later—and the longer you live, the better that trade looks.
But everyone’s situation is different. The right answer depends on your health, your other resources, whether you’re still working, and whether you’re married.
What’s not a good strategy: grabbing it at 62 because you saw a social media post, or because you’re afraid it might go away, or because you didn’t think about it at all.
Think about it. Run the numbers. Make the decision that fits your life.