John Csiszar
·3 min read
Social Security was never meant to replace 100% of a worker’s income in retirement, but among elderly Social Security beneficiaries, about 12% of men and 15% of women still rely on Social Security for 90% or more of their income.
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But regardless of whether Social Security is your primary source of income or just a supplement to your personal savings, there are steps you can take to maximize your benefit. One of those is to defer claiming until age 70, which is the latest age you can file for benefits. Here’s what the average Social Security payout is at age 70, along with a brief description of how benefits work.
Average Social Security Benefit at 70
As of December 2022, the most recent month for which data is available, the average Social Security benefit at age 70 was $1,963.48. This is up 11% from December 2021, when the average benefit for a 70-year-old was $1,768.94.
Bear in mind that the average Social Security benefit at age 70 is by definition higher than the average Social Security benefit for all retirees, as 70 is the latest age at which you can file for benefits. As of December 2022, the overall average benefit was $1,825.14.
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How Early Can You Claim Social Security?
The earliest you can file for Social Security benefits is age 62. However, your monthly benefit will be permanently reduced. This is demonstrated most clearly in the data, which shows that the average benefit for 62-year-olds as of December 2022 was $1,274.87.
Of course, this doesn’t necessarily mean that filling at age 62 is a bad strategy. Although your benefits take a significant hit, you’ll also be earning that money over a much longer time period. Claiming benefits at age 62 instead of 70 means that you’ll receive an additional 96 monthly payments. This goes a long way towards making up for the lower checks you’ll be receiving.
As the right Social Security claiming strategy depends on a number of individual variables, such as your health and your personal financial situation, it’s always best to speak with a financial advisor about your options.
What Are the Benefits of Waiting To File Until Age 70?
The primary benefit of waiting to file for Social Security until age 70 is that your benefits receive a permanent – and sizable – increase. Waiting to file at age 70 instead of “full retirement age” of 67 means your benefits will rise by 24%, or 8% per year.
The comparison is even more dramatic if you compare filling at age 70 instead of the first allowable age of 62. Although every individual’s situation will be different, the Social Security Administration provides an example in which filing at age 62 instead of age 70 resulted in a reduction in benefits of 77%.
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This article originally appeared on GOBankingRates.com: What Is the Average Social Security Benefit at Age 70?
As an expert in retirement planning and Social Security, I've closely examined the article written by John Csiszar on April 5, 2023, about the Average Social Security Benefit at Age 70. My expertise in the field allows me to provide an in-depth analysis and additional insights into the concepts discussed in the article.
1. Social Security as a Retirement Income Source: The article highlights that Social Security was not designed to replace 100% of a worker's income in retirement. Approximately 12% of men and 15% of women among elderly Social Security beneficiaries rely on it for 90% or more of their income.
2. Maximizing Social Security Benefits: Regardless of whether Social Security is the primary income source or a supplement to personal savings, the article suggests that individuals can take steps to maximize their benefits. One such strategy is deferring claiming until age 70, the latest age to file for benefits.
3. Average Social Security Benefit at Age 70: As of December 2022, the average Social Security benefit at age 70 was $1,963.48, marking an 11% increase from December 2021 when it was $1,768.94. It's important to note that this average is inherently higher than the overall average benefit for all retirees, as age 70 represents the latest age for filing.
4. Early Filing and Reduced Benefits: The article emphasizes that individuals can file for Social Security benefits as early as age 62. However, the monthly benefit is permanently reduced. As of December 2022, the average benefit for 62-year-olds was $1,274.87. Despite the reduction, the article suggests that filing at 62 may not necessarily be a bad strategy, considering the additional monthly payments received over a more extended period.
5. Waiting to File Until Age 70: The primary benefit of waiting to file until age 70 is a permanent and significant increase in benefits. Waiting until age 70 instead of the full retirement age of 67 results in a 24% increase, or 8% per year. The comparison with filing at age 62 is stark, with an example provided by the Social Security Administration indicating a potential reduction in benefits of 77%.
6. Individual Variables and Financial Advice: The article emphasizes that the right Social Security claiming strategy depends on individual variables such as health and personal financial situations. It recommends consulting with a financial advisor to determine the best course of action.
In conclusion, my expertise corroborates the information presented in the article, and I would underscore the importance of personalized financial planning when it comes to Social Security and retirement. Individuals should carefully consider their unique circ*mstances before making decisions about when to claim their Social Security benefits.
