Claiming Social Security: 5 important things to consider

For most workers and their spouses, Social Security provides a steady stream of income in retirement. But did you know that the age at which you start taking benefits affects the size of your monthly check? To determine the best strategy to maximize your Social Security benefits, you need to evaluate the rules along with your own needs and circumstances. Consider these tips for claiming benefits.

1

Waiting brings advantages

You become eligible for Social Security benefits at age 62. Tempted as you may be to start receiving these checks as soon as possible, claiming your benefit right away isn’t always the best option. In fact, your check is 25 percent smaller at 62 than if you wait until your full retirement age (66 or 67, depending on the year you were born). Plus, for each year you wait to claim beyond your full retirement age, you can get up to an additional 8 percent per year in benefits. Watch this video about Social Security from Merrill Edge for more information.

2

Consider your health and family history

While waiting to collect Social Security benefits yields a larger monthly check, what if you suffer from a serious illness or don’t expect to enjoy a long life expectancy? This isn’t an easy question to ask—but it is a critical part of your decision. The longer you live, the more money you need to provide for your retirement.

If your relatives all live to 99 (suggesting that you may, too), a decision to delay retirement and hold out for a larger Social Security payment could pay off. But if you’re in a physically demanding line of work, or your family history or personal medical issues are a concern, taking your benefit at a younger age could make sense.

3

Understand your risk tolerance

Unlike investments, your Social Security benefit provides you with a guaranteed stream of income that increases as the cost of living goes up. If you delay receiving your benefit until you are older, your Social Security check becomes a larger percentage of your income, so you don’t have to worry as much about inflation, market returns or how long your nest egg might last.

This makes waiting a particularly good strategy for those with low risk tolerance—those who cannot risk the chance of losing money on an investment. For example, if you do not expect to have many other income streams, such as a pension, or withdrawals from other retirement investment accounts, like an IRA, this is an important thing to consider when deciding when to file for Social Security. For more on how to develop a retirement strategy, check out Merrill Edge’s overview of different considerations. 

4

Marital status matters

If you’re married and you and your spouse are both eligible for Social Security benefits, you can elect to claim them at different times. If might make more sense for both of you to wait, or for one of you to begin claiming benefits at age 62 while your partner postpones until age 70.

When a two-income couple defer collecting benefits until each person is 70, they can increase their expected joint lifetime benefits by more than 20 percent, compared with what they’d receive if they each claimed their benefits at age 62.

5

Mind the income gap

While you may understand the benefit of delaying your Social Security claims, you might wonder how you bridge the gap between ages 62 and 70. If you have another source of guaranteed income (such as a pension), it can be easier. Otherwise, you might need to work longer to build up your nest egg or save more to meet monthly expenses during those years. For more information, check out these tips on boosting your retirement savings from Merrill Edge.

You have probably worked hard for your Social Security benefits, and your first instinct may be to take them as soon as you are eligible. But if you are able to delay and rely on other income for a few years, it may make a big difference in your retirement.

Close Disclaimer
The material provided on this website is for informational use only and is not intended for financial or investment advice. Bank of America and/or its affiliates, and Khan Academy, assume no liability for any loss or damage resulting from one’s reliance on the material provided. Please also note that such material is not updated regularly and that some of the information may not therefore be current. Consult with your own financial professional when making decisions regarding your financial or investment options.

Up Next

Contact Us

  • Mon-Fri 8 a.m. to midnight Eastern Sat 8 a.m.-8 p.m. Eastern, Sun 9 a.m.-8 p.m. Eastern
    866.736.2205 Mon-Fri 8 a.m. to midnight Eastern Sat 8 a.m.-8 p.m. Eastern, Sun 9 a.m.-8 p.m. Eastern
  • Schedule an appointment

Merrill Edge® is available through Merrill Lynch, Pierce, Fenner & Smith Incorporated (MLPF&S), and consists of the Merrill Edge Advisory Center (investment guidance) and self-directed online investing.

Banking products are provided by Bank of America, N.A., and affiliated banks, Members FDIC and wholly owned subsidiaries of Bank of America Corporation.

Investment products:

Are Not

FDIC Insured 

Are Not

Bank Guaranteed

May Lose Value


MLPF&S is a registered broker-dealer, Member SIPC and a wholly owned subsidiary of Bank of America Corporation.