Deciding whether to retire at age 64 or wait until 67 can significantly affect your social security benefits. Generally, the longer you wait, the more you will be able to collect. However, there are limits, and you will also have to consider your lifestyle, healthcare and life expectancy to determine whether you should retire early or not. A financial advisor can help you create a plan to retire early, while delaying your Social Security to maximize benefits.
General Factors to Determine Your Retirement Age
Deciding to retire at age 64 or 67 involves weighing your financial needs and lifestyle preferences. Retiring early at 64 can lead to reduced Social Security benefits, a gap in healthcare coverage and possibly increased long-term costs. Waiting until 67, however, could increase your monthly Social Security benefits and give you more time to grow your retirement savings, although it requires working three additional years, which may not be feasible.
Social Security Benefits
Social Security benefits are based on a retiree’s highest 35 years of earnings and their retirement age. Retiring before full retirement age results in a permanent reduction in monthly benefits. At 64, retirees will see a reduction of about 20% to 25%. At 67, retirees receive their full benefit with no reductions, maximizing lifetime payments if they live a long life.
If you can afford to wait even longer, retiring at 70 maximizes your benefits, as delayed retirement credits increase your payments by about 8% each year past full retirement age until age 70. And, if you have a spouse who is eligible for benefits, don’t forget to coordinate with them so that you can maximize your household income.
Earning Potential
Social Security has an earnings limit for those who claim benefits before the full retirement age (67 for most people). As of 2025, if an early retiree earns more than $23,400, their benefits are reduced by $1 for every $2 earned over the limit. At 67, retirees can work without any reductions, making it easier to supplement their income. So, if you expect to earn significant wages while collecting benefits, delaying until 67 can help you to avoid reductions.
Healthcare Coverage and Medicare Eligibility
Medicare eligibility begins at age 65. Retiring at 64 means managing a one-year health insurance gap. You could rely on a spouse’s policy, purchase your own, or pay for COBRA coverage. These options can be expensive. For those with chronic health conditions or medical expenses, it may make more financial sense to wait until you can take full advantage of Medicare.
Other Financial Needs
When deciding between early retirement at 64 or waiting until 67, other financial resources play a factor in your decision. For example, if you paid off your mortgage early, you may find it easier to retire early. Here are five financial things to consider for early retirement:
- Retirement savings: If you have significant savings in 401(k)s, IRAs, or other retirement accounts may afford to retire early more comfortably.
- Pensions: If you receive a pension, then this steady income stream could help you reduce your reliance on Social Security.
- Passive income: Income from investments, rental properties, or other passive sources can supplement your early retirement and ease financial constraints.
- Low living expenses: If you have modest lifestyles or live in an area with lower costs of living, you may find it easier to retire earlier.
Life Expectancy
Life expectancy is a key factor in choosing when to start receiving Social Security benefits. If you anticipate a longer lifespan, delaying benefits until 67 or beyond can be financially advantageous. But, if you are facing health issues or who have a family history of shorter lifespans, you might find it more beneficial to start receiving benefits at 64.
Your decision can also affect the financial well-being of a surviving spouse. If one spouse waits longer to claim Social Security, it could result in higher survivor benefits after their passing. This consideration is particularly important for couples where one spouse may significantly outlive the other.
Bottom Line
Choosing to retire, and claiming Social Security at 64 or waiting until 67, depends on your financial situation, health and lifestyle goals. Retiring at 64 gives you early freedom but reduces your Social Security benefits and requires securing healthcare before Medicare starts. Waiting until 67 boosts your monthly benefits and provides full Medicare access. Given the significant impact on your long-term finances, consulting with a financial advisor can help you plan a retirement that balances your financial needs and lifestyle preferences.
Tips for Retirement Planning
- A financial advisor can help you plan for a comfortable retirement by setting and adjusting different goals. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- If you want to calculate future monthly benefits, SmartAsset’s Social Security calculator can help you get an estimate.
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