Social Security Benefits – Starting at Age 62 vs FRA Calculator

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This calculator computes the break-even point and the cumulative benefits for an individual taking his own Social Security retirement benefits beginning at age 62 versus beginning at his or her full retirement age (FRA). It is an estimate only, and should not be the only consideration when deciding when to begin social security benefits.

Factors can affect the decision to receive Social Security benefits, including health, personal financial considerations, and employment status. One method of assessing the financial advantage is to calculate the break-even age.

Taxpayers planning for their retirement should be aware that retirement benefits depend on age at retirement. If a taxpayer begins receiving benefits before full retirement age, the taxpayer will receive a reduced benefit. A taxpayer can choose to retire as early as age 62. Starting to receive benefits after full retirement age may result in larger benefits.

Calculator tab

Monthly benefits at FRA

This field can be estimated by the Social Security administration’s Retirement Benefits calculator. It is based on your current and/or future wages earned.

Inflation rate

The inflation rate will act to increase monthly benefits similar to a cost of living adjustment (COLA). This calculator assumes a constant rate of inflation.

Percentage of Social Security benefits subject to income tax

An individual may pay federal income taxes (or state income taxes) on Social Security income if the individual has significant income such as wages, self-employment income, interest and/or dividend income, and other taxable income. Income thresholds for the appropriate tax percentage exist for individuals with income from other sources. See IRS Publication 915 for further details.

Social Security Benefits Schedule tab

Social Security PIA column

This column, Social Security Primary Insurance Amount, is the dollar amount an individual receives if the individual waits until FRA to start receiving Social Security.

Example

An individual is attempting to determine at what age they would like to start receiving Social Security benefits because of recent health issues.

Field Input
Date of birth 03/05/1954
Federal income tax rate during retirement 25.0%
Percentage of Social Security benefits subject to income tax 85.0%
Inflation rate 2%
Monthly benefit 1150

In this example, the break-even point for total Social Security received is identified by (actual):

  • Years from age 62 to break-even point (14),
  • Year of break-even point (2030), or
  • Age at break-even (76).

Conclusion: If the individual lives past age 76, the individual would receive greater lifetime Social Security benefits by waiting until full retirement age to start receiving benefits.

Note: Break-even occurs at the age when the total Social Security income from two options is the same.

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