Social Security Shell Game: File Early or Wait?

social securityThe Social Security program in this country has undergone many changes over the 82 years since it’s inception, but I’m not here to decry manipulation or the theft of public monies by corrupt politicians.  I’m looking at whether I should “retire” at age 62 or wait until full retirement age of 67 (yes, it’s 67 now).  To run the numbers I used:

Retirement Calculator

This calculator gives you a personal estimate of what your average monthly Social Security benefits would be, based on if you retire early (age 62), at full retirement age (age 67) or at the latest age of retirement (age 70).  This one accesses your S.S.A. data to give you an accurate payment amount.


So. Sec. Benefits by Year of Birth

This chart uses “average” numbers to help you make a decision without going into your personal info.  Here’s how it shakes out for me.

Doing the Social Security Math

I was born in 1956.  If I retire at age 62 I’d receive $733.00 per month in Social Security payments.  If I wait until 67 I’d get $1,000.00 per month.  The question is, “Is it worth waiting the extra 5 years?”

$733.00 per month collected for 12 months would be $8,796.00 per year.

Multiply that by 5 years to get $43,980.00 received by age 67.

The difference between the two payments ($1,000 – $733) is $267.00

If I divide the $43,980.00 I received before full retirement age by the difference in payments ($267.00) I find that it will take me approximately 165 months (14 years) at $1,000 to have made back what I didn’t get by retiring early.  I’d be 91 years old before I actually saw a benefit — in terms of total funds collected from Social Security — if I waited to age 67 to file.

In looking at the calculators (and the changes that have been made to retirement ages) it’s clear that the government is hoping to get people to delay filing by dangling the carrot of a larger payment before them.  I’m guessing they’re hoping we’ll die before reaching Full Retirement Age (or before we reach that break-even point) and they can just keep the money we paid in over our working lives.

Given the constant changes to the Social Security laws, I do believe I’ll be filing for payments to begin at age 62.  But I have to file 3 months before my birthday, so I’m marking my calendar now!

Picking the Nits

I had Mensa Mike check my math to make sure I didn’t make some goofy mistake.  He says it’s fine but there are some nits to see too in case anyone wants to pick at them.

For those born in 1956 (one of the best vintages), the full retirement age is 66 years and 4 months.  But for round figures, you are exactly right (using 67).

However, here’s the real catch:  When the social security act was passed in 1935, the retirement age was 65 (there was no 62 “early” draw) and the expected life span of the average American male (most women didn’t work outside the home then) was 59.9 years.  It was really meant to take care of the outliers, not the average person.

Thanks Mike!


If you decide to delay your benefits until after age 65, you should still apply for Medicare benefits three months before your 65th birthday. If you wait longer, your Medicare medical insurance (Part B) and prescription drug coverage (Part D) may cost you more money.

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