Social Security expert Marcia Mantell breaks down exactly what the 62 vs 67 vs 70 decision means for your retirement.
The headlines about Social Security are terrifying right now. Benefit cuts. A trust fund running dry. Congressional inaction. And you might be thinking: should I just grab my benefits now before something changes?
According to Social Security expert Marcia Mantell, that instinct, while completely understandable, could be one of the most costly financial mistakes you ever make.
“What I don’t like about these fear-inducing headlines is they hurt the people who haven’t yet claimed, those coming into 62, 63, 64, thinking, ‘Oh my God, I better grab mine now,'” says Mantell, founder of Mantell Retirement Consulting and author of Social Security: Lightly Toasted, Not Burnt: How to Make Your Best Claiming Decision.
What Happens When You Claim at 62
Claiming at 62 is the earliest you can file for Social Security, and for many people, it’s tempting. Maybe you’re exhausted, or burnt out, or worried about the program’s future, and just want to get something while you can.
But Mantell is blunt about the cost. “If you claim at 62, you have made the decision to lock in a 30% permanent reduction to your monthly benefits,” she says. “We’re lucky if we get a 2 or 3% raise every year while we’re working. Why would you lock in a 30% cut to your benefits when you can control it?”
In real dollars, that hits hard. “If you have a primary insurance amount of $3,000 a month at 67, claiming at 62 drops you to $2,100 a month,” Mantell explains. “That’s a lot less than $3,000.”
And that reduction doesn’t just affect your monthly check; it compounds over time. “Each year in retirement, your benefit will increase for that annual cost-of-living adjustment,” she says. “When you have a smaller starting point, your COLAs are less effective over the years, and you get less. So I don’t want to be 85 and go, ‘I really should have waited longer.'”
What Claiming at 67 (Your Full Retirement Age) Actually Means
For most people today, full retirement age is 67. This is the age at which you receive your full, unreduced benefit, and your primary insurance amount, or PIA. It’s the baseline against which every other claiming age is measured.
Claiming at 67 means you won’t take the hit that comes with claiming early, but you also won’t get the boost that comes with waiting. For some people, particularly those in poorer health or with a pressing need for income, full retirement age is the right call.
But Mantell says the math strongly favors holding out a little longer if you’re healthy and you can afford to wait.
The Bottom Line on Social Security 62 vs 67 vs 70
For every year you delay claiming beyond your full retirement age, your benefit grows by 8%. Wait until 70, and that adds up to a significant permanent increase.
“If you can wait until 70, and your benefit is hypothetically $3,000, you go from $3,000 to $3,700 a month,” Mantell says. “An extra $700 a month, that is a really important decision.”
And it’s not just about the monthly check. “The first thing that comes out of your Social Security check, unbeknownst to most people, is your Medicare Part B premium,” she says. “Then you pay tax on at least a portion of your Social Security benefits. So you want to start with a higher base.”
“I don’t want to be 85 and go, ‘I really should have waited longer,'” Mantell says.
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