The timing that a claimant files for their Social security retirement benefits determines that initial monthly benefit from that point going forward. The best approach is contingent on the claimant’ other available resources, retirement date, and expected longevity. This analysis is further complicated by the transfer of excess monthly benefit to a surviving spouse, so the claiming strategy for each spouse’s Social Security retirement benefit must be carefully studied before the first one files.
Benefits at Full Retirement Age (FRA)
The age at which no discount or premium based on the date that Social Security retirement benefits are claimed. Originally, FRA was established as age 65, but has risen to as high as age 67 based on the claimant’s birth year. See the table below:
Benefits at an Early Retirement Age
Although the majority of claimants file for their Social Security retirement benefits at their first eligibility at age 62, this results in a deep discount to their monthly benefit and is high as 40% less than waiting until their FRA.
Benefits at Delayed Retirement Age
Since some claimants may continue working past FRA or may have other assets to draw upon, they can delay filing for their Social Security retirement benefit to as late as age 70 and will receive an 8% annual increase to their FRA for each year that they delay past their FRA. For a potential claimant with a FRA of age 67, this will result in a 24% increase (3 years times 8%) to their monthly Social Security retirement benefit for their remaining lifetime.