This 1 move could shrink your Social Security check by up to 30%

Social Security is the largest federal retirement program. Four out of every five Social Security recipients are older folks funding their retirement years. In fact, retired Americans get most of their income from Social Security, according to a 2024 Gallop poll. 

You can maximize your benefits if you wait to claim Social Security until your full retirement age or older. However, claiming earlier could shrink your monthly check by as much as 30 percent.

When can you claim Social Security benefits?

Workers can start to get Social Security retirement benefits as early as 62 years of age. 

After you turn 62, you can claim Social Security at any age. But the amount you receive varies widely depending on when you start to receive benefits. You will get the lowest amount if you start drawing at 62 and the highest if you start at 70 but you won’t get anymore by waiting past 70, which offers 124 percent of your benefit.

How early retirement reduces Social Security benefits

Even though you can start getting Social Security benefits as early as 62, that doesn’t always mean you should. Claiming benefits at 62 reduces your benefits by 30 percent compared to full retirement at age 66 or 67. 

Say you turn 62 this year and decide to claim Social Security benefits. Because you’re receiving benefits before your full retirement age, your benefits will be 70 percent of what you’d get at 66 to 67 depending on when you were born.

Let’s assume your benefits would be $2,000 at age 67. If you claimed benefits at age 62, you’d get $1,400 a month instead. Waiting those five extra years increases your monthly payouts by hundreds of dollars.

You can retire at 62 or earlier though and not claim Social Security until your full retirement age or later. You just need a retirement plan that accommodates that change in income. A financial advisor can help you map out your retirement and figure out how to get there.

How delaying retirement increases Social Security benefits

Taking early retirement lowers your monthly payout, while delaying it could increase your monthly benefits.

Full retirement age is now 66 to 67 for Social Security. That’s when you can receive 100 percent of your benefit but you can receive more if you wait to draw until 70. Delaying retirement can fully maximize your benefits, giving you 124 percent of your benefit. If you’re expecting $2,000 at 67 years of age, waiting until 70 means you could get up to $2,480.

While that looks minimal in the short term, consider what that looks like over time. Putting off drawing Social Security from 62 to 70 could get you an extra $1,000 monthly in your Social Security benefit payouts.

Should you take an early Social Security payout?

Some people may want to claim benefits as early as 62 because they were forced to retire early, need the income or can’t find enough work to pay for all of their needs, such as mortgage payments, utilities, health care and more. 

Taking an early benefit shouldn’t be the first resort but one of the last ones. If you’re considering taking it, add these two factors into your calculations. 

1. When you take Social Security before your full retirement age, there are limits to how much you can earn without affecting your benefit. 
2. There are only a few avenues to stop receiving Social Security once you start. If your situation changes, you may not be able to roll back your decision and delay drawing to receive a higher benefit later.

Consider if these other options may work for you instead of tapping Social Security before your full retirement age.

• Keep working: Continue to work until you’ve reached your full retirement age.
• Try a different job: If you can’t find jobs where you traditionally worked, explore alternative jobs or industries.
• Rely on other income: Use your other retirement accounts, such as a 401(k) or IRA, to cover expenses until you reach full retirement.

How much can you earn in Social Security benefits?

The maximum amount you can earn in monthly Social Security payouts depends on how much you earned during your working years. The Social Security Administration averages what you earned during your 35 highest-earning working years. A benefits calculator can give you a rough idea of how much you may get.

However, there is a cap on how much each person can receive from Social Security. For 2025, retiring at your full retirement age would get you $4,018 per month at most. If you wait to retire until 70, you could get up to $5,108. But if you retire at 62, the most you’ll get is $2,831 monthly. 

This is only the maximum amount. The average monthly Social Security benefit for retired workers is $1,976 in January 2025.

Bottom line

Delaying Social Security benefits until 70 maximizes your benefits, so the longer you wait after turning 62, the more money you’ll get. But delaying after 70 won’t earn you any extra money and you can claim full retirement benefits at 66 or 67. So what’s the right age for you? That depends on your goals and income needs. Working through scenarios with a financial advisor may be a good place to start.