Social Security at 67: Why Waiting for Full Retirement Age Can Pay Off
Key Points
At 67, you can collect your Social Security benefits without a reduction if you were born in 1960 or later.
Filing at 67 could lead to more guaranteed income for life -- and more peace of mind.
It could also make life less complicated if you opt to continue working while getting benefits.
- The $23,760 Social Security bonus most retirees completely overlook ›
Claiming Social Security benefits isn't so straightforward. That's because there are different filing ages you can choose from.
You can begin collecting Social Security once you turn 62. But if you were born in 1960 or later, you may want to wait until you turn 67 to file for benefits. Here's why.
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You won't have to worry about reduced monthly checks
The primary benefit of waiting until 67 to claim Social Security is that it's your full retirement age if you were born in 1960 or later. That means you'll get the monthly checks you're eligible for based on your earnings history without a reduction.
That's an important thing for a couple of reasons. First, Social Security is a guaranteed income source.
Your savings, for example, could run out over time if your investments don't perform well or the market crashes repeatedly while you're drawing from your portfolio. But Social Security is meant to pay you a monthly benefit for the rest of your life, no matter how long it is and how the market does.
To put it another way, the more Social Security you collect, the more peace of mind you might gain.
Also, Social Security benefits have built-in inflation protection. Each year, those benefits are eligible for a cost-of-living adjustment (COLA) that's designed to match price increases.
If you file for Social Security at 67, your monthly checks will be higher than if you claim at an earlier age. That means your COLAs should also be higher (not on a percentage basis, but on a dollar basis).
Earning money won't be a problem
Another good reason to claim Social Security at 67? Once you reach full retirement age, you can earn any amount of money while collecting benefits without having to worry about the program's earnings test.
If you're receiving Social Security prior to full retirement age, earning more than a certain amount of money could result in withheld benefits. But that earnings test doesn't apply to you once you've reached full retirement age. At that point, you could earn $300,000 a year and still get your complete Social Security check.
While filing for Social Security at 67 isn't automatically right for everyone, there are plenty of good reasons to go that route. So you may want to push yourself to hold off until full retirement age, especially if you're not super confident that your savings will last throughout retirement or you simply want more of a guaranteed paycheck to enjoy for life.-
The $23,760 Social Security bonus most retirees completely overlook
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