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Older Americans Working Longer, Claiming Social Security Later

Older Americans are working longer and claiming their Social Security benefits later, new research from the Social Security Administration shows. 

Social Security recipients can begin to claim retired-worker benefits any time between ages 62 and 70.  The earlier they claim them, the smaller their monthly benefit will be, but whether workers claim benefits early or late, they tend to receive the same total benefits over the course of their retirement.

The SSA study finds that:

  • Fewer workers claim Social Security benefits at 62.  The fraction of Social Security claims at age 62, the earliest eligibility age for retirement benefits, has fallen by about a third over the past 15 years.  From 1995 through 1999, nearly half of eligible 62-year-olds claimed Social Security as soon as they could.  By 2010-2015, less than one-third did.  (See chart.) 
  • Workers increasingly wait until age 66 or beyond to claim benefits.  Social Security’s full retirement age — the age at which workers can receive unreduced Social Security benefits — rose from 65 to 66, starting in 2000.  As the full retirement age rose, more people waited until 66 to claim benefits.  An average of 56,000 66-year-olds claimed benefits each year from 1995-1999.  By 2010-2015, the number rose nearly tenfold, to more than half a million, and the rate at which eligible 66-year-olds began to claim benefits in a particular year more than doubled.  This trend likely will continue as Social Security’s full retirement age rises to age 67, starting next year.  
  • Older Americans are working longer.  A larger share of Americans age 60 or older continue to work.  From 2000 to 2015, the labor force participation rate among 65- to 69-year-old men rose nearly a quarter; among women it rose nearly half.  Labor force participation is also up among 60- to 64-year-olds, particularly women.  Even Americans age 70 or older are working more.

Working longer and delaying Social Security claiming can boost workers’ retirement security.  The longer they wait to claim, the larger their monthly Social Security benefit will be.  The longer they work, the more they can save — and the fewer years they’ll need to make their retirement savings last.  Working longer also increases contributions to Social Security, improving its finances.

Though the trends toward longer careers and later claiming are encouraging, it’s important to remember that claiming Social Security early is the right decision for many Americans.  For example, half of older workers who lost their jobs during the past five years hadn’t yet found new work, a recent study showed — and those who did often settled for lower wages or fewer hours.  In addition, disability rates rise sharply with age, and in most cases older workers’ illnesses and injuries don’t meet the strict medical standards for Social Security Disability Insurance.

The facts that many workers are already working longer and claiming later call into question some policymakers’ support of raising Social Security’s retirement age, which would cut all retirees’ benefits, no matter when they claim.  Doing so could cause serious hardship for people who cannot realistically work and rely heavily on Social Security in retirement.