"Filing for Social Security at full retirement age (FRA) means you'll avoid any sort of reduction to your monthly benefits. FRA is 67 for people born in 1960 or later, but it varies slightly for earlier birth years-check SSA.gov for your exact age. However, you're allowed to claim Social Security once you turn 62. And the further away from FRA you are, the more of a hit to your benefits an early filing will cause."
"For example, if you claim Social Security a year early, you'll reduce your benefits by about 6.67%. But if you claim Social Security at 62 with an FRA of 67, that's five years early, and it will result in a 30% reduction. Keep in mind, these reductions are permanent, though annual cost-of-living adjustments (COLAs) apply to the lower base amount."
"On the flipside, if you delay Social Security past FRA, your monthly benefits get to increase 8% per year until you turn 70, potentially boosting your lifetime income significantly if you live longer than average. However, waiting on Social Security is a tough thing. It could mean having to work longer than you want and having to put off the retirement goals you've always dreamed of. So you may be more inclined to file for benefits early rather than late."
Full Retirement Age (FRA) determines whether monthly Social Security benefits are reduced or paid in full; FRA is 67 for those born in 1960 or later. Benefits can be claimed from age 62, but early claims reduce monthly amounts permanently (about 6.67% per year early; five years early equals roughly 30% reduction). Delaying past FRA increases benefits by 8% per year until age 70. Deciding when to claim involves tradeoffs including work plans, retirement goals, health, and family longevity. Early claiming can also affect savings and employment choices while cost-of-living adjustments apply to the reduced base.
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