Social Security is like math class: it can be intimidating and complicated, but it’s ultimately extremely beneficial when leveraged properly.
Having received a number of questions from clients over the years on the topic of Social Security, we thought it would be valuable to share answers to the questions we hear most.
When can I claim benefits, and how does timing affect me in the long run?
Technically, you can collect your Social Security benefits as early as age 62—but annual benefits will be reduced (25-30%) for the rest of your life.
For that reason, we often encourage clients to think carefully before taking benefits earlier than they need to.
That said, if you claim benefits at your full retirement age (FRA), you will receive your full benefit without a permanent reduction.
If you choose to delay collecting your benefits beyond your FRA, you may do so. In this case, you’ll receive them at an increased amount of 8% per year (or 2/3 of 1% each month you wait after your FRA), up to age 70. This also locks in a higher survivor benefit.
So how do I know my full retirement age (FRA)?
It differs depending on your age. Use the chart below to determine yours:
Year of Birth |
Full Retirement Age |
| 1943 - 1954 | 66 |
| 1955 | 66 and 2 months |
| 1956 | 66 and 4 months |
| 1957 | 66 and 6 months |
| 1958 | 66 and 8 months |
| 1959 | 66 and 10 months |
| 1960 or later | 67 |
I’ve decided when I want to start taking Social Security; now what?
Once you’ve decided when you’d like to start receiving benefits, you can file up to four months prior to the month you’d like benefits to begin (or three months prior to your birthday).
You can apply online— however, it’s generally recommended to make an appointment at your local office.
Once you have filed for benefits, unlike your FRA, which is calculated depending on your year of birth, your benefit payment date is calculated depending on your actual day of birth:
So, for example, if your birthday is March 12th, you’d receive your payment on the third Wednesday of every month.
What if I want to keep working but also receive benefits?
You can absolutely do that, but you need to know the parameters.
For example, if you choose to start collecting benefits earlier than the year you reach your FRA, you only get the full Social Security benefit payout if your pay is under an annual earnings limit.
The chart below shows these limits in more detail. (It’s important to note that any benefits that are withheld don’t disappear, you’ll just have to wait for them until you do reach FRA to get them.)
2024 Annual Earnings Limit |
Benefits to Be Withheld |
|
| Younger than FRA | 66 | $1 for every $2 over annual earnings limit |
| Year Reach FRA | 66 and 2 months | $1 for every $3 over annual earnings limit |
| Month of FRA | 66 and 4 months | No limit on earnings |
In addition, if your earnings from January 1 the year you reach your FRA to end of the month prior to FRA are less than your earnings limit, $59,520, then benefits will be paid for the months prior to FRA.
For example, a client recently reached her FRA in May 2024 —let’s call her Sue. Sue began her benefits at age 62 and continued working.
Because Sue’s earnings did not exceed $59,520 from January 1 through April 1, she received all of her benefits for 2024.
I’m no longer married. What do I need to know about collecting Social Security on a former spouse?
This one requires a little more in-depth explanation, which we walk through in a separate article focused on collecting Social Security on a former spouse.
Social Security can get complicated, but it plays a key role in reaching financial freedom post-retirement.
If you have any questions about these or other Social Security-related topics, it may be time to seek out a partnership with a wealth manager. To learn more about what wealth management could look like your financial plan, download our free guide.
