When planning for retirement, one of the most important choices you’ll face is when to claim Social Security benefits. The age at which you file directly affects how much you’ll receive each month—and the difference can be significant over the course of your retirement.
How Social Security benefits are calculated
Your monthly Social Security benefit is based on your 35 highest-earning years in the workforce. Once your average earnings are calculated, you’ll get your full benefit if you file at your full retirement age (FRA). For anyone born in 1960 or later, the FRA is 67 years old.
But you also have options:
Claim early: You can start collecting as early as age 62, but your monthly payments will be reduced for each month before FRA.
Delay benefits: For every year you wait beyond FRA (up until age 70), your monthly benefit grows by about 8% per year.
This means timing is critical. A decision to claim early or late could add—or cut—thousands of dollars over your lifetime.
Why Social Security may face cuts
While the program has supported retirees for decades, funding challenges are growing. Social Security relies mainly on payroll taxes from current workers. But as millions of baby boomers retire, the number of younger workers entering the workforce isn’t enough to keep the system balanced.
For now, Social Security can tap into its trust funds to cover shortfalls. But according to the latest Trustees Report, those funds could run dry by 2034.
If that happens, the program may only be able to cover about 81% of promised benefits. This means retirees could see a 19% cut in their checks unless Congress passes reforms.
How cuts could impact your filing decision
When deciding when to claim Social Security, you need to consider:
Your monthly income needs in retirement
Other income sources (pensions, savings, investments)
Your health and life expectancy
For example:
Suppose your full benefit at 67 is $2,500 per month, and you expect another $3,500 from savings. That gives you the $6,000 you need each month for expenses and leisure.
But if Social Security cuts reduce benefits to 81%, your $2,500 may drop to around $2,000.
In this case, you would need to either:
Adjust your spending in retirement, or
Delay filing for Social Security to increase your monthly benefit.
This is why it’s crucial to run different scenarios while planning. An early claim may look fine based on today’s system, but if cuts arrive, your budget could suddenly feel very tight.
The importance of smart planning
Social Security alone was never meant to fully fund retirement. Still, it forms a major part of most retirees’ income. By carefully choosing your filing age—and preparing for possible cuts—you can protect yourself from future financial strain.
Waiting longer to claim may not work for everyone, but it can be a useful strategy if you’re worried about lower payouts in the future.
The age at which you claim Social Security is one of the biggest decisions in retirement planning. While filing early may give you money sooner, it reduces your benefit permanently. Delaying can boost your monthly check, which may help offset potential cuts expected around 2034.
To stay financially secure, it’s wise to plan for both current benefit levels and the possibility of reduced payments. Factoring in different scenarios today can help you retire with confidence tomorrow.
