Nearing Retirement

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Social Security: How to decide when it's time

August 19, 2013

If you're still working but nearing retirement, you've probably asked yourself, "When should I start taking Social Security benefits?"

Starting before the program's "full retirement age"—66 for those born between 1943 and 1954, gradually rising to 67 for those born in 1960 and later—means accepting a lower monthly benefit. But starting later than full retirement age, at any point up to age 70, increases your monthly benefit even more for each year that you hold off initiating benefits.

You can get estimates of your monthly benefits at different starting ages by visiting

As the accompanying table shows, starting your benefit at the earliest possible age—62—can allow you to receive a higher total benefit ... but only if you pass away before reaching the average life expectancy. But retirees who live into their 80s and beyond would receive a higher total if they waited to start their benefits.

The great unknown, of course, is how long you're going to live. That single factor makes the best answer for you unavoidably a guessing game.

Colleen Jaconetti"According to the Social Security Administration, for those who reach age 65 this year, the median life expectancy is about age 84 for men and 86 for women," said Colleen Jaconetti, a Vanguard senior analyst. "That means about half of those reaching 65 will live past those averages. And planning for the possibility of a long retirement is even more important for married couples, because the odds of at least one spouse living to age 90 are about 45% for couples who reach age 65."

The advantages of waiting

As you consider when to start taking your Social Security benefit, here are a few general guidelines worth remembering:

  • From the earliest possible start year, each year you delay taking your benefit will boost your annual payout by as much as 8%.
  • For married couples, it's preferable that the higher earner start his or her benefit as late as possible. This is because the surviving spouse gets the higher of the two benefits, no matter which one is started first.
  • A portion of your Social Security benefit may be taxable, depending on your income level.

"The amount that's taxable is based on a 'combined income' formula that includes just half of a person's Social Security benefit up to a certain income threshold," Ms. Jaconetti explained. "However, up to 85% of Social Security benefits are taxable for those with higher incomes."

Alternative strategies

If you have the resources to meet basic living expenses without taking full Social Security benefits, you may want to consider alternative strategies, such as "file and suspend," "restricted application" (called "free spousal benefit" by Social Security), or "reset" (called "request for withdrawal of application"). While complex, these strategies can increase lifetime benefits.

The Social Security Administration's website,, provides more information. The site also allows you to create an online account to view your projected benefits based on your salary history to date. You may wish to consult with a financial advisor to discuss your specific circumstances.

How Social Security payments can change depending on when you start

Social Security payments

Note: This table shows hypothetical monthly benefits for a worker born after 1960 who retires at one of three ages with a final annual salary of $100,000. Total benefits received depend on the retiree's lifespan. Source: Vanguard.


  • This information is provided for educational purposes only. We recommend that you consult a financial advisor about your individual situation.
  • When you access any of the third-party sites mentioned in this article, you'll be leaving our site. Except where noted, Vanguard accepts no responsibility for content on third-party websites.
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