Personal Finance

Over 60? 3 Things You Need to Know About Social Security If You'll Be Taking Benefits Soon

Maurie Backman

Published: December 3, 2024 4:42 pm

Key Points

• Your Social Security filing age impacts your monthly benefits.
• Be careful when claiming early and consider a later filing if your savings are limited.
• Know how your wage history impacts your benefits.
• Also: Take this quiz to see if you’re on track to retire ^(Sponsored)

Once you turn 60, you can begin the countdown to retirement. And if you’re over 60, it means that you may be on the cusp of ending your career and claiming Social Security.

If you expect to file for benefits soon, it’s important to know exactly how they’re calculated and how your filing age will impact the amount of money you get each month. Keep these points in mind before you make your decision.

1. Filing early will reduce your benefits for life

Social Security becomes available to you once you reach age 62. But you don’t get your complete monthly benefit until full retirement age (FRA) arrives. FRA is 67 for anyone born in 1960 or later. If that’s your FRA, you may want to wait until that point to sign up for benefits to avoid a reduction.

Otherwise, if you’re going to claim Social Security early, understand exactly what reduction you’re looking at. Create a my Social Security account to see what benefit you’re eligible for at FRA and what an early filing will do to it. Seeing the numbers in front of you might sway your decision.

2. Working longer could get you more benefits

You may be eager to end your career to free up your time and avoid the stress that comes along with your job. But you should know that working a few extra years could lead to higher Social Security checks for you in retirement.

The Social Security Administration (SSA) calculates your monthly benefits based on your 35 highest-paid years of income. If you’re over 60, you may already have a 35-year work history. But if you’re earning much more now than you were early on in your career, working longer allows you to replace some lower-income years with a higher income. The result? More Social Security for you.

If the idea of continuing on in your current job doesn’t appeal to you, an alternative is to find a job that’s less demanding. Or, see if your employer will support a phased retirement that has you working part-time. You may find that you’re still able to command a higher wage now — even with part-time hours — than what you earned earlier on in your career, even if the wages you earned in your 20s are adjusted for inflation (which is what the SSA does with earlier wages).

3. Delaying your claim could pay off big time

The SSA rewards seniors who delay their claims past FRA with boosted benefits. Specifically, your monthly checks increase 8% for each year you hold off, up until age 70.

Delaying Social Security makes sense in a few scenarios, such as if you don’t have a lot of savings and therefore need a larger retirement benefit to compensate. Also consider holding off on Social Security if you have terrific health in your 60s and a family history of long lifespans. If you think there’s a good chance you’ll still be around in your 90s or beyond, a larger Social Security benefit could make it so you’re less worried about depleting your savings in your lifetime.