Should you start early or wait? Four situations to consider before collecting Social Security.

Should you start early or wait? Four situations to consider before collecting Social Security.

It makes financial sense to wait until you hit full retirement age to start collecting your Social Security benefits. Here’s why: your Social Security benefits will shrink if you begin sooner. What’s considered full retirement age? It’s 66 if you were born between 1943 and 1954 and as old as 67 if you were born after 1959.

So how much of a hit will you take if you start early? According to the Social Security Administration, if you’re the main wage earner, were born between 1943 and 1954, and begin taking payments at 62—the earliest age that you can begin collecting—you’ll receive just 75 percent of the benefit that you'd receive if you waited until full retirement age. Obviously, this adds up as you age.

However, there are times when retiring early—and collecting those monthly Social Security checks before you hit full retirement age—may actually be a better financial decision. Read on for four special situations where it may make sense to start early.

1. If You Cannot Work: You’d pictured yourself working until full retirement age, but now, suddenly, that’s no longer possible. Whether it’s due to poor health, a lost job, or reasons beyond your control, it may make sense to begin drawing your Social Security benefits before you reach your full retirement age if you can no longer work. If you have no other source of income, taking a smaller Social Security benefit each month may be a better alternative than running up credit card debt or facing the possibility of losing your home to foreclosure.

2. If Your Health is Bad: If you’re in poor health, or suffering from a life-threatening disease, you could consider taking your Social Security benefits earlier. It’s obviously impossible to predict how long you’ll live. But—and this is a rough estimate—if you expect to live past 78, it makes more sense to wait until you hit full retirement age. If you don’t think you'll live to 78, it makes sense to take your Social Security payments earlier.

3. If You’re Married and Your Spouse is Ready to Start Collecting: Even if you have not reached full retirement age, it’s considered smart for married couples to begin taking their Social Security benefits at the same time. The reason is that if your spouse passes away before you do, you can choose either to receive your Social Security benefits or your spouse's, whichever is higher.

4. If Your Spouse Has Passed Away: If you’re a surviving spouse, you can either claim your own Social Security benefits or those of your deceased partner. You'll obviously take the highest payment. However, if you choose to take your spouse's benefits before you reach full retirement age, these benefits will be reduced permanently. But could it make sense for you to take this route anyways? In some cases, like if you’d otherwise struggle to pay your household bills without the benefits of your deceased spouse, you should consider taking your benefits earlier.

Everyone’s financial situation is different. For more information about Social Security retirement benefits under current law, visit If you need help gaining more control over your money, make an appointment to talk to one of our knowledgeable financial advisors.


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