To most people, Social Security seems like a very simple concept: You pay in to the system during your working years, then you retire and start getting those monthly checks.

But if you want to maximize your benefits (and who doesn’t), you need to study how and when to start taking your benefits. You need to develop a Social Security claiming strategy. And the decision is far from simple. Get it wrong, and you could leave a significant amount of income on the table over your lifetime – easily six figures.

Social Security benefits don’t kick in automatically once you turn a certain age. You become eligible at age 62. If you wait until full retirement age, however, you’ll receive bigger monthly checks (full retirement age is 66 for those born between 1943 and 1954, and 67 for those born in in 1960 or later). You can receive even larger payments by waiting until age 70 to receive your benefits, the maximum age that benefits continue to grow.

As a general rule, the earlier you take Social Security, the smaller your monthly check will be. Starting your benefits at age 62, for example, means you’ll receive 25% to 30% less each month than if you waited until full retirement age.

What’s more, a range of factors play into making the best decision. Life expectancy is a key consideration, of course. If your parents and grandparents lived long lives, you might be more comfortable holding out for those bigger checks. Otherwise you may want to claim benefits earlier.

Developing a Social Security claiming strategy can get complex very quickly if you are married, but within the complexity lie the opportunities. It’s not uncommon to learn that there may be hundreds of different strategy and claiming date combinations available to you.

Market conditions also play a part in your Social Security claiming strategy. Right now, the “returns” available to you by delaying your benefits can outpace the anemic interest rates generated by bonds, money market accounts and certificates of deposit. If you can afford to wait until age 70 to take your benefits, you will receive bigger checks, and the difference in income will dwarf any returns you could have earned from Treasuries or other traditional “safe-haven” investments.

To complicate matters more, optimizing your Social Security claiming strategy may involve structuring the timing of income from your other retirement benefits and withdrawals from your retirement accounts, each with potentially different tax exposures.

When is the right time to take Social Security? The answer is that there is no single right answer – however you can help optimize your claiming strategy if you take the time to study your specific situation. It’s not much different from engaging in some good tax planning, and advanced computer software is a big help. If you would like help developing a Social Security claiming strategy, we may be able to help. That’s just part of what we do.