Should You Take Social Security At 62, 67, Or 70?

The decision of when to claim Social Security is one of the most important retirement choices you will make. The difference between claiming at 62 versus 70 can mean hundreds of dollars per month for the rest of your life.

Claim at 62 and your benefit is permanently reduced by about 30%. Claim at your full retirement age (67 for most people) and you receive 100% of your benefit. Claim at 70 and you get roughly 124% of your full retirement age benefit plus cost-of-living adjustments along the way.

For someone with a full retirement age benefit of $2,000 per month, the difference between 62 and 70 is about $800 per month. Over a 20-year retirement, that adds up to nearly $200,000 in total benefits.

The catch: you need income to bridge the gap between when you stop working and when you claim Social Security. This is where annuities can help. A short-term annuity or income rider can provide income during those bridge years, letting you delay Social Security and lock in the higher benefit.

With annuity payout rates still elevated, the combination of a bridge annuity and delayed Social Security is a powerful strategy for maximizing your lifetime income.