2 Reasons Why Social Security Timing Could Be The Key To Your Retirement
Written by
Adam Palasciano
Edited by
Amen Oyiboke
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Retirement should be a time of rest, relaxation and enjoyment. Today, the number of Americans entering their golden years is rising.
As of January 2025, the Social Security Administration reported that about 73 million Americans receive a Social Security payment each month, compared with 72.3 million as of June 2024. Of those 73 million, about 56.2 million are age 65 or older — that’s more than three-quarters of all Social Security recipients in the U.S.
However, while more and more American retirees are claiming Social Security, timing when you collect your benefits is key to securing a financially sound retirement for yourself and your family. Here are three reasons why:
You Still Plan To Work After You Start Collecting Social Security
According to the Social Security Administration, you may continue to work while simultaneously collecting Social Security benefits. However, if you’re younger than the current full retirement age (FRA) of 67 (for those born in 1960 or later) and earn more than the yearly earnings limit ($23,400 for 2025), $1 will be deducted from your benefit payments for every $2 earned above the limit, if you’re under the FRA for the entire year.
So, you may want to delay starting to collect your benefits if you’re still working full time or be sure you’re earning no more than the yearly earnings limit to ensure there’s no reduction in your benefits. Delaying your benefits will result in a larger monthly payment later on.Â
Be Sure Not To Claim Benefits Too Early
The Social Security Administration highlighted that you can claim your benefits as early as age 62. However, in doing so, you’ll only receive 70% of your calculated monthly benefit amount.
If you delay collecting Social Security, your monthly benefit amount will increase every month after age 62 until you reach FRA, at which time you’d be eligible for 100% of your monthly benefit.
It’s crucial to consider your financial needs, health conditions, and life expectancy when deciding the best time to claim your benefits. If you choose to collect your benefit earlier in retirement, you’ll be permanently locked into a lower payment for the rest of your life, which will also result in smaller cost of living adjustments each year.
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