At what point should you start collecting your Social Security benefits? The answer may not be as easy as you think.

Many people don't realize that when they begin taking Social Security benefits determines the percentage of benefits they will actually receive.

The key to the answer lies in what is considered your "full retirement age." It used to be that you could retire "early" by collecting benefits starting at age 62 or you could wait until you were 65. Retiring early meant permanently reduced payments.

But now, depending on the year you were born, you will not reach your full retirement age until between 65 and 67. People born in 1937 or earlier reach "full retirement age" at 65. From 1938 on, it rises gradually to age 67.

You even have an option of delaying your benefits past your full retirement age, thereby locking into an even higher monthly check. If you plan on working during retirement, you may want to delay benefits, as your earnings could negatively affect the amount. However, there are also instances where taking early benefits will most likely pay off.

If you start collecting at the earliest opportunity -- age 62 -- you'll receive a permanently reduced benefit, but you could make out better overall if you live long enough to offset the reduction.

If you wait until your full retirement age, you can collect 100 percent of your benefit. You may lock into an even higher monthly check by delaying Social Security longer still.

Determining which option is right for you depends on a number of variables, including your life expectancy, financial picture and -- according to economists at the Center for Retirement Research -- gender and marital status.

Put it off
Generally, financial advisers say it's best to postpone Social Security benefits as long as possible, at least until your full retirement age as determined by the Social Security Administration, or SSA.

"Social Security is like longevity insurance," says Brent Neiser, a Certified Financial Planner and director of the National Endowment for Financial Education. "It's a stream of payments that will not stop throughout your life, so delaying your benefits to keep those payments as large as possible forms a helpful base to your retirement plan."

Early Social Security can cost you

If your full retirement age is 67, your Social Security benefit is reduced: • About 30 percent if you start collecting at 62. • About 25 percent if you start collecting at 63. • About 20 percent if you start collecting at 64. • About 13.3 percent if you start collecting at 65. • About 6.7 percent if you start collecting at 66.

In fact, he notes, those who under-saved for retirement should use whatever means possible to postpone their Social Security benefits until after their retirement age to help boost future income.

If your full retirement age is 66, for example, you'll receive 108 percent of your monthly benefit by delaying Social Security until age 67.

If you wait until age 70, it jumps to 132 percent.

"You can use personal savings to help bridge the gap, but ideally you should plan to work a little longer (and delay Social Security)," Neiser says. "Not only does that save you money -- since you're not drawing money down from your retirement accounts -- but you're potentially adding more to it. Plus, you'll collect larger Social Security benefits (down the road)."