I’m 64 with $2.2M. When should I take my Social Security?
Jeremy Keil explains how to determine the right time to start taking Social Security as a part of your retirement income strategy.
One of the biggest questions people face when they retire is, “When should I take Social Security?” It’s a decision that can impact your lifetime income by hundreds of thousands of dollars, and unfortunately, many people make it without understanding the long-term consequences.
On the Mr. Retirement YouTube channel, I recently walked through a real-life scenario featuring John and Mary, a couple in their early 60s who just retired. They have $2.2 million in retirement savings and are trying to decide when to claim their Social Security benefits. Let’s take a closer look at how they approached this decision — and what you can learn from their example.
Step 1: Start with Life Expectancy
Before making any financial move in retirement, I tell everyone to first understand their retirement longevity — how long they might live. Your life expectancy determines how long your income needs to last, which means it also shapes when you should take Social Security.
John, age 64, and Mary, age 62, are both in average health and nonsmokers. Using longevityillustrator.org, we discovered:
- John’s median life expectancy is 22 more years, taking him to age 86.
- Mary’s is 26 more years, bringing her to age 88.
- Together, their joint life expectancy — the time at least one of them is expected to live — is about 29 years.
Why is their joint life expectancy longer than either of their individual life expectancy? Think of how averages work. Generally speaking, one number is above the average and one number is below the average.
On average, one of the couple will live longer than average – and it’s that longer life that happens, on average, that you need to plan for.
Step 2: Understand Your Options
Here’s what John and Mary were working with:
- John’s full retirement age benefit: $3,000/month at age 67.
- If he takes it at 64, he’ll get a 20% cut — $2,400/month.
- If he waits until 70, he’ll receive a 24% increase — $3,720/month.
- Mary’s full retirement age benefit: $2,000/month at age 67.
- If she takes it now at 62, she’ll face a 30% reduction, down to $1,400/month.
- If she waits until 70, she’ll earn 24% more, or $2,480/month.
These numbers might not sound huge month to month, but over a 25- or 30-year retirement, the difference could add up to hundreds of thousands of dollars.
Step 3: Don’t Just Look at One Scenario
Most online Social Security calculators spit out a single answer — “Wait until 70!” — and leave it at that. But that’s not always the whole picture.
When we modeled John and Mary’s lifetime benefits using different claiming ages, we found:
- Waiting until 70 for John and 69 for Mary would result in $1.4 million in total lifetime benefits.
- Taking benefits early at 64 and 62 would reduce that total by about $230,000.
That’s a massive gap — but the right choice isn’t always about maximizing the total. It’s about balancing lifetime value, income needs today, and security for the surviving spouse.
Step 4: Find the “Good Enough” Zone
Here’s the good news: you don’t have to hit the exact “perfect” timing to make a smart decision. When we compared different filing ages, we found that if John took his benefit about 15 months earlier than 70, he’d only lose 2% of his total lifetime benefit. Meanwhile, Mary could claim five years earlier than 69 and still stay within 1.5% of the max.
That’s practically a rounding error — and it gets them the majority of the benefit while providing more income earlier in retirement.
So, instead of treating it like an all-or-nothing decision, find the “good enough” point that fits your comfort level and lifestyle goals.
Step 5: Discover Which Benefit is Most Impactful
All Social Security benefits are not equal. While Social Security grows at 7-8% for each year you wait to take it, 8% on a bigger number – is a bigger number!
And notice how Social Security grows as you get older. If you’re the older spouse, you’ll get to those older ages before the younger spouse!
For John and Mary, finding the “good enough” zone helped them see which benefit was more impactful to their finances. If John took Social Security 15 months earlier, it created a bigger loss in value than if Mary took Social Security 5 years earlier!
What did that tell them? Every year that John waited was a big deal to their finances. And every year that Mary took Social Security early, it didn’t mean too much overall. That helped them focus on delaying John’s Social Security to get more money overall, and also taking Mary’s earlier than expected so that they were getting some cash flow from Social Security as soon as they could.
Step 6: Think About the Survivor Benefit
One of the most overlooked aspects of Social Security planning is the survivor benefit. When one spouse passes away, the surviving spouse keeps the higher of the two benefits. That means the higher earner’s benefit has lasting importance.
In John and Mary’s case, if John takes Social Security at 64, his benefit would be $2,400 — and that’s the amount his widow would inherit. But if he waits until 70, that survivor benefit grows to $3,720. That’s an $1,100 per month difference for the rest of the surviving spouse’s life. For many widows or widowers, that higher income can be the difference between security and stress.
Step 7: Coordinate Social Security With Your Investments
Social Security doesn’t exist in a vacuum — it’s part of your overall retirement income plan. John and Mary’s investments could support their spending needs even if they delayed claiming their benefits, allowing them to maximize their future Social Security.
But not everyone’s in that same position. The key is to balance your guaranteed income (like Social Security) with your investment withdrawals. Sometimes, taking benefits a bit earlier makes sense if it allows you to preserve other assets or reduce taxes. The point is to integrate everything, not make decisions in isolation.
The Bottom Line
John and Mary’s situation shows that Social Security isn’t just a simple “take it early or wait until 70” question.
Don’t just take Social Security at 70 because a computer told you.
Don’t just take Social Security at 62 because your friend said that’s what they did.
Make your decision based on:
- How long you might live
- The survivor benefit
- Your current income needs
- The interaction with your investments
Happy Planning! – Mr. Retirement
About the Author:
Jeremy Keil, CFP®, CFA® is a financial advisor in Milwaukee, WI, author of the bestseller Retire Today: Create Your Retirement Master Plan in 5 Simple Steps and host of both the Retire Today Podcast and Mr. Retirement YouTube channel
Links:
- Buy Jeremy’s book – Retire Today: Create Your Retirement Master Plan in 5 Simple Steps
- Try your own longevity projection at longevityillustrator.org
- Learn how to build your full retirement income plan at FiveStepRetirementPlan.com
- Work with my team to get more income, pay less in taxes, and avoid big retirement mistakes: KeilFP.com
Disclosures
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