Want to Delay Your Social Security? Here’s Why You Need to Plan for That in Advance

When it comes to signing up for Social Security, you have a wide range of choices. The earliest age to claim Social Security is 62. But if you file then, you risk a reduced monthly benefit for life.

Waiting until full retirement age (FRA), on the other hand, means you won’t have to worry about a reduction in your monthly benefits. FRA is 67 if you were born in 1960 or later.

But there’s also the option to delay Social Security past FRA. And it’s an option you may want to exercise for good reason. For each year you delay Social Security past FRA, your benefits get an 8% boost.

Now unfortunately, you can’t keep growing your monthly benefits forever. Once your 70th birthday arrives, you no longer get credit for delaying Social Security. So you might as well sign up at that point.

But all told, waiting until age 70 could give you a higher guaranteed monthly paycheck for life. So it’s a smart thing to do if you expect to live well into your 80s or 90s, or if you don’t have a lot of money saved for retirement and want to compensate.

But you should also know that claiming Social Security at age 70 isn’t something you can do on a whim. If you want the option to delay Social Security past FRA, you’ll need to plan for that in advance. Here’s why.

You need income from somewhere

While there’s a clear upside to delaying your Social Security claim, in order to have the option to wait on that money, you need funds to pay your bills. So if you intent to hold off on Social Security, you’ll need to make sure you’re either able to work longer, or that you have enough savings to live on until you start getting benefits.

To that end, you have choices. If it’s too late to build savings, you can focus on keeping your work skills current so you’re less likely to lose your job or get pushed out of it.

It’s also a good idea to maintain strong relationships with your colleagues well into your late 60s so you’re able to establish yourself as a key player on your team. That could set the stage for being able to work until you turn 70.

Unfortunately, many older workers are pushed out of their jobs due to age discrimination. It’s illegal, of course, but very hard to prove. So it’s best to do what you can to avoid being a victim of it.

Another option, of course, is to make sure you have enough savings to support larger withdrawals in your 60s if you don’t end up working until age 70 but want to claim Social Security then.

If you retire at 65, for example, but have nice savings, it may be possible to withdraw the equivalent of what Social Security would pay you for the next five years, all the while delaying your claim. That way, you can sign up for benefits at 70 and lock in higher payments for life.

But either way, you need a plan.

Does delaying Social Security make sense for you?

Some people are interested in delaying Social Security for the guarantee of larger monthly benefits. But you should know that putting off your claim may not make financial sense if you don’t think you’ll live longer than the average retiree.

While delaying your claim boosts your Social Security benefits on a monthly basis, it won’t necessarily result in more income on a lifetime basis. So if you need help running the numbers or making a decision, consult a financial advisor. An advisor can also help you work toward the goal of delaying Social Security if you determine jointly that filing for benefits at age 70 is the right choice.

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