Social security is an important aspect of your retirement plan but when is the right time to start collecting?

It is crucial to think about how your social security will be used. The timing of collection could be different based on how much you will be relying on social security. Living on social security alone might not be enough, specifically if you want to have a comfortable standard of living that allows you to branch out a little.

Let’s start with when you can start collecting. Across the board, the earliest age you can collect is 62, but you will see a reduction in payouts. Depending on the year you were born, your full retirement age will be different. Each year waited until your full retirement age, the lower the reduction becomes. For those born in 1960 and later, the age at when you can receive full benefits is 67 years old.1

The same is true for collecting a spouse’s benefits. The age of 62 is the earliest you can collect but you would receive about 32.5 percent of your spouses payouts. Waiting until your full retirement age would allow you to receive the maximum amount, which is 50 percent of your spouse’s payout.2

If you were born before 1960 visit the SSA calculator to find out your maximum payout age.

An important factor in your decision is expenses. Most retirees can expect expenses to increase during the first 15 to 20 years of retirement. Then as they typically become less active in their 80s, expenses go down. Planning on this change could increase the enjoyment during the first decade of retirement. There’s nothing wrong with taking benefits early if the money could be useful now; it should be done when you feel you’ll most benefit from the payouts. The optimal time to start collecting social security should depend on your personal situation.

Sometimes it’s important to worry less about maximizing returns and more about the usefulness of those returns. Some choose to take out social security early to accomplish tasks like supplement their home or travel while they’re active. Others with high amounts of capital, choose to wait until they get maximum benefits for their payout. Most people probably can’t rely on social security alone, it’s designed to be about 40 percent of the person’s average working income.3 Because of this, think about how you want to use it and the timing that will be right for your situation.

The right time to collect your social security is personal. It can depend on your lifestyle, retirement expectations and monthly expenses. Having someone to help you, that has you in mind, is a great way to figure it out. At Miramontes Capital, our financial architects look at every case individually to help you decide what is right for you. There is no set path for everyone but there is one thing that always rings true: think about what’s right for you.


1 “Retirement Planner: Full Retirement Age.” Social Security Administration. Web. n.d.

2  “Frequently Asked Questions.” Social Security Administration. Web. n.d.

3  “Retirement Planner: Learn About Social Security Programs.” Social Security Administration. Web. n.d.

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Miramontes Capital is a Registered Investment Adviser. Advisory services are only offered to clients or prospective clients where Miramontes Capital and its representatives are properly licensed or exempt from licensure. This blog is solely for informational purposes. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. No advice may be rendered by Miramontes Capital unless a client service agreement is in place.