Confused About When to Claim Social Security? 3 Questions You Have to Ask Yourself

One of the toughest decisions you might face when planning for retirement is figuring out when to claim Social Security. While the monthly benefit you're eligible for hinges on your personal earnings history, your filing age determines whether that benefit is paid in full, reduced, or boosted.

You can claim Social Security at any time once you turn 62. If you want your benefit without a reduction, you'll have to wait until full retirement age, which is 67 if you were born in 1960 or later. You can also boost your benefit by 8% a year, up until age 70, if you delay your claim past full retirement age.

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If all of these choices have your head spinning, you're not alone. But answering these three questions could make your decision easier.

1. How much income will my savings provide relative to my spending needs?

Knowing how much income you need from Social Security should help you narrow down a filing age. First, figure out a retirement budget based on your fixed costs and the things you want to do with your time. Next, see how your savings factor in.

If you expect to need $5,000 a month to live comfortably and you can withdraw $3,000 a month from your savings without increasing your risk of running out, that means Social Security needs to provide $2,000 of income. If your full retirement age benefit is $2,000, filing early is probably a mistake. If you want more breathing room, you may decide to delay your claim for a year past full retirement age so your benefit gets a boost.

2. How strong is my health?

The longer you live, the more lucrative a delayed Social Security claim can become. On the flip side, if you don't expect to live a long life, filing early generally leads to a larger lifetime Social Security benefit.

Think about your health and how long you're likely to live. It's impossible to know exactly what your lifespan will entail, but if you have multiple medical issues in your early 60s and your parents passed away fairly young, you may want to claim Social Security on the earlier side. Reduced monthly checks could still lead to a larger lifetime total if you end up passing away in your early or mid-70s.

3. How reliant will my spouse be on survivor benefits?

If you're married and earned more than your spouse, it means your Social Security benefit may be larger than theirs. If they outlive you, they'll typically be entitled to survivor benefits from Social Security equal to 100% of your monthly check. So the larger your benefit is, the more you'll financially support your spouse after your passing.

Now if you have lots of savings or a generous life insurance policy, your spouse may not be as reliant on Social Security survivor benefits. So think about how they'll manage financially if you pass away first, and let that help inform your decision.

It's important to claim Social Security at the right time. Answering these three questions should make it easier to find an optimal claiming age.

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