3 Scenarios Where Claiming Social Security at 70 Absolutely Pays Off

One of the hardest financial decisions you might have to make in your lifetime is figuring out when to claim Social Security. Though you can sign up for benefits at any point once you turn 62, you'll need to wait until full retirement age to get those monthly checks without a reduction.

Full retirement age is 67 if you were born in 1960 or later. But you should know that your options don't end there. For each year you delay your Social Security claim past full retirement age, up until age 70, your benefits get an 8% boost.

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Now, that doesn't mean claiming Social Security at 70 always makes sense. There are plenty of situations where it pays to start getting that money sooner. But here are three scenarios where a claim at age 70 could be your smartest move by far.

1. You have minimal savings for retirement

As a general rule, Social Security will replace about 40% of your pre-retirement paycheck if you earn an average wage. But most seniors need roughly twice that much income to manage their expenses comfortably, which is why retiring on Social Security alone typically isn't enough.

If you're nearing retirement and aren't happy with your IRA or 401(k) balance, claiming Social Security at 70 could be your ticket to larger checks that help compensate.

It's important to assess your retirement account balance and see what annual income it amounts to, using an assumed withdrawal rate. You can incorporate the popular 4% rule or another rate you feel may work better. If the result isn't enough to cover your costs based on your full retirement age benefit, then pushing your Social Security claim off until 70 could come to the rescue.

2. You have great health and a family history of longevity

The risk of claiming Social Security at 70 is that you have to wait longer to start getting those monthly checks. If you don't live very long, you could lose out on lifetime Social Security income despite boosting your benefits on a monthly basis.

But if your health is strong and you have a family history of longevity, that may be less of a concern. And if you end up living a longer-than-average life, you'll typically come out ahead financially by delaying Social Security until 70 rather than signing up for benefits earlier.

3. You want to leave your spouse a robust survivor benefit

If you're the higher earner in your household and are likely to be outlived your spouse, then your Social Security claiming decision shouldn't be all about you. It should also factor in your spouse's financial needs.

Once you pass, as the lower earner in your household, your spouse should be entitled to survivor benefits from Social Security equal to the amount you received while you were alive. If you delay your claim until 70, you can do more than just boost your own checks. You can potentially leave your spouse with considerably larger monthly benefits for the rest of their life, too.

In fact, even if delaying Social Security until 70 is likely to give you less total income in your lifetime, you should also run the numbers at the household level. It may be that a delayed claim might shortchange you a bit, but ultimately provide a higher total benefit between you and your spouse.

It's not always easy to delay Social Security until 70, as doing so could mean working longer or relying on other income sources to tide you over. But in these situations, claiming benefits at 70 could work in your favor, so it pays to see if waiting to file is feasible.

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