Social Security and Retirement

Social Security and Retirement :  What You Need to Know

When contemplating retirement, you may be counting on Social Security benefits to provide you with a basic level of income. However, the age at which you choose to retire is an important part of the equation. There are also other issues to consider when making your choice.


Consider the following questions:

1) How would an early retirement, for example at age 62 vs. age 65, affect your Social Security benefits?

2) How will those benefits be taxed? and

3) Is it in your best interest to continue working to earn extra income when your Social Security benefits could be reduced based on your earnings?

What’s the Maximum?

Social Security provides only a base level of income. The maximum benefit for a person who retires in 2017 at full retirement age is $2,687 per month. In 2016, the maximum benefit was $2,639 per month. It is important to note that the benefit for a non-working spouse is 50% of that amount.

Should You Delay Retirement?

If you delay retirement past your full retirement age, your monthly benefit will increase, based on the age at which you elect to take retirement benefits. But, upon attainment of age 70, the benefit increase no longer applies, even if you continue to delay payment.

Taking benefits at age 62, which is considered early retirement, is appealing to many people. However, if you decide to take early retirement benefits from Social Security, your monthly benefit amount will be permanently reduced by 20–30%, based on your full retirement age.

Some people continue working and earning additional money to supplement basic Social Security income. This is where you need to be careful. If you earn more than the maximum amount allowed, you may forfeit some of your benefits. If you are under full retirement age, receive Social Security benefits, and earn additional income, your benefits will be reduced by $1 for each $2 you earn over $16,920 ($1,410 monthly) in 2017. During the year in which you attain full retirement age, your benefits will be reduced by $1 for every $3 earned over a certain amount $44,880 ($3,740 monthly) in 2017. Upon attainment of full retirement age, there is no earnings limit, and Social Security benefits will not be reduced.

Full Retirement Age Is Changing

For a long time, full retirement age was 65. Due to longer life expectancies, that age is increasing gradually until it reaches age 67. This change began in the year 2000 and affects people born in 1938 and later. Age 62 remains the earliest you may begin to receive Social Security retirement benefits.

For Your Information

The Social Security Administration (SSA) website at provides an online calculator for an estimate of your future retirement benefit.

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Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. Your results may vary.