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I always thought waiting until 67 to take Social Security was the responsible choice, until life gave me a reason not to.
I retired early, but I’ll save that story for another time.
What mattered then was this, I’d earned enough credits to claim Social Security at 62. Under Jonathan’s guidance, the plan was simple, we wait until 67 and lock in a larger monthly check. It was sound advice, grounded in math and discipline. So I held onto it.
Then everything changed.
Jonathan received a terminal diagnosis.
All the careful planning, the spreadsheets, the projections, the idea of a long, steady retirement suddenly felt fragile. You spend years preparing for the future. What you don’t plan for is the moment when the future becomes uncertain.
After his diagnosis, my twin brother Nick and I made a different decision. We claimed Social Security in early 2025, at around 64 1/2.
A quick “back of the envelope” calculation put my break even age for waiting until 67 in the low 80s—around 83. Live beyond eighty three, and delaying pays off. And if you don’t, it doesn’t. Simple enough on paper.
But life isn’t lived on paper.
I used to say longevity runs in our family. Now I’m not so sure. The truth is, none of us knows how long we have. That realization shifts the question from what’s optimal to something more personal: what matters now?
At 65, I can still travel and experience things I’ve put off. But life has its own constraints. Settling my sister’s estate has kept me close to home. My mother, who turns 87 in June, needs my help. Like many, I’m trying to find that balance between responsibility and living while I can.
There’s a lesson in all of this, and it isn’t that everyone should claim Social Security early. For some, waiting will absolutely be the right call.
The real lesson is about flexibility and balance.
We’re often told to optimize: Maximize benefits, minimize taxes, delay gratification. And those things matter. But so does recognizing when life changes the equation.
Retirement planning isn’t just about numbers. It’s about time, time we assume we’ll have, but aren’t guaranteed.
Some people carry expensive lifestyles into retirement and pay the price later. Jonathan always preached the opposite: go into retirement without a mortgage, keep your life manageable, and give yourself options. In a way, that mindset is what made my decision easier—because flexibility matters when life doesn’t go as planned.
We spend years planning for a future that isn’t guaranteed. At some point, the plan has to make room for living.
Another great HD contribution–thanks for this.
Great article. Being a numbers guy, I made lots of calculations and also saw a breakeven at about 83 years old. My decisions were made when my wife was 62 years old. We decided to take hers early at 62, and maximize mine at 70. This has worked nicely for us. Now at 80 we hope to live to 100, do not look surprised, that is our goal, and if we make 86, or 96 it will not matter, as it is a plan. In life you will live happier, if you plan for the best, but stay flexible. You also be happier is you live ODAAT, one day at a time.
I also managed to wait to age 70. I did go through a year-by-year assessment as to whether I “needed” to claim each year (starting at age 63, when I retired). While not planned, I had some part-time work that provided additional income until age 68 so that help us as well. Waiting also allowed us to increase our Roth conversion amounts over a six-year period (due to less overall income). That opportunity allowed us to convert 40% of our portfolio to Roth. That reduction of our T-IRA reduced our RMD proportionally, which further reduced the taxable portion of our SS benefit from 85% to 73%. We have the potential to reduce it down to 60% by using the revised method of RMD calculation allowed by Secure Act 2.0 (since we also annuitized part of our T-IRA). It is difficult to total up the financial benefit of waiting if you also factor these situations.
Awhile back in response to a question regarding investing SS benefits claimed at FRA (vs waiting to age 70), I did a “what if” analysis. This analysis compared collecting SS at FRA (age 66 in this case) and investing such assets for four years (assuming 5% rate of return) against having an extra 32% at age 70. If I use $30K as the benefit at FRA, the investment path computes to $135,769. By waiting four additional years, you get $9,600 extra. In essence, this is comparable to getting $9,600 “annuity income” or equivalent to a 7.1% lifetime payout, with inflation-protected COLA. If you use a guaranteed investment rate of return of 6% (instead of 5%), the payout rate reduces to 6.9% (still not too bad for an inflation-protected benefit). If you are married, as the higher income earner, you can also consider this income “addition” to be a joint-survivor benefit.
If you had the option of “investing” $135,769 with a guaranteed return of 7.1% and have that principal “grow” at the rate of inflation (CPI-W), would you take that deal? To illustrate that last statement, let’s assume that the CPI-W was 3%. That $9,600 would increase to $9,888 after one year. At a 7.1% payout, the effective principal to generate that benefit would be $139,842 (a 3% “growth” of the initial principal). While there is no such principal, this is another way to look at comparing claiming early or waiting from a financial viewpoint.
Amen brother. The Social Security decision would be an easy one if we know how long we’ll live, how our needs might change later in life, etc. but we don’t. After many years of my adulthood involving delayed gratification, I’m now trying to get into a mindset of freeing up a little spending. Best wishes to you on your decision.
There’s a behavioral nudge in favor of claiming an annuity like Social Security earlier as well. We tend to spend more of an annuity than an equivalent withdrawal from our savings, because we know that the annuity payment will recur next year, while a projected 4% withdrawal rate (for example) could vary depending on how our investments perform. Combine that propensity with greater physical abilities when you are younger, and you get an incentive to have the Social Security when you are willing–and able–to spend and enjoy it.
One of Jonathan’s last articles before he got his diagnosis was on planning for longevity, a sad irony he himself commented upon later. When I read that article, I realized that I had never really considered longevity as a serious “risk” for myself—my father and both grandfathers died of heart attacks in their 60s (my father at just 61) and my brother had major heart surgery at 47. On the other hand, my mother will be 85 this year, and I take better care of myself than those family members did. So I think I should probably expect to be more like my mother, but as you point out, you just never know.
I am going to file for Social Security next year when I reach my full retirement age (67). Our recent home purchase has motivated me to generate more current income so that our budget won’t be too tight in these early retirement years. My husband is still working and planning to wait to file until age 70.
For those that aren’t aware Mike Piper has website named Open Social Security which is considered the gold standard site for determine what age(s) are best for claiming maximal benefits.
I’ve harped on this before, but his calculator determines what claiming strategy generates the maximum lifetime benefits. Who cares about that and why?
Ive answered before also (many times)…….I care about it because 1-it protects against longevity risk, 2-it maximizes the SS income after the delay, 3, it produces more without full taxation (for us that’s 85%), 4-it provides room for Roth conversions during the delay, 5. it provides a higher benefit to my wife after I pass. Amongst other points..
no, the total a couple is projected to receive over their collecting lives does none of that. Delaying to age 70 may help with all that, but that is not what the calculator does.
If you both live long enough. That’s the point of this article
My thought is that tools of this nature appeal to people who have not needed or wanted to claim Social Security prior to FRA or age 70. For those in this category, it potentially becomes an exercise of examining how to attempt to get the best return for an “investment” (albeit a forced one) from all the years of Social Security related payroll deductions.
You are certainly correct. We are learning the twists in life now as cancer has changed our life in ways we never expected.
One thing I simply cannot understand is why some people focus on so-called breaking even with Social Security. You paid a tax or as I view it an insurance premium. You may get a little, an average amount or a great deal back as in our case. Either way the goal is to maximize your income when you need it most. Relatively few people can or do delay to 70. 62 is the most popular age to collect SS.
We started SS when we surely didn’t need it at FRA as I was still working. We saved both of our benefits for several years and invested it all in municipal bond funds. Over the last 17 years those funds have accumulated several hundred thousand dollars and pay monthly tax-free interest equivalent to more than half my gross SS benefit.
I don’t suggest this strategy for anyone else because they are not in our situation, but I cannot see delaying beyond FRA just on the basis of seeking to break even.
What I don’t understand is your saying the goal is to maximize income when you need it most but then you started taking Soc Sec when you surely didn’t need it.
That is a goal most people need, it was not my goal, i don’t need to maximize SS, my goal was to accumulate additional assets which is what I did. Now i have a significant investment generated from SS and additional income when we need it.
I’m 5 years older than my wife and have a considerably greater benefit coming. I’m delaying to 70 to maximize the spousal benefit and as a longevity insurance of sort. Our situation, not everyone’s.
a spousal benefit does not increase if you wait until 70 to claim it. While the worker’s own retirement benefit increases by 8% annually for each year they delay past full retirement age (up to 70), spousal benefits max out at 50% of the worker’s full-retirement-age amount
Correct regarding the spousal benefit. Was Doug actually referring to the survivor benefit?
I thought that the spousal benefit was based on your benefit at full retirement age. If so, then waiting until 70 would not increase the spousal benefit.
I agree with your general approach. But how does one know when they will need social security most? Life isn’t a straight line.
That said, I agree that many people treat this issue of when to claim as a traditional investment account where they want to “get their money back” as quickly as possible.
Viewing it as a hedge against outliving your assets is a much more robust strategy for long-term stability. That was my approach.
Mine too. Maximizing the benefit, for those who can afford this option, is a form of “Longevity insurance”.
I guess the decision also should consider what portion of retirement income is made up of social security.
I agree for the most part. My plan is to maximize the COLA-adjusted monthly benefit. I don’t know or care what the breakeven point is.
I claimed at 70. SS is my only income that is inflation adjusted so I wanted to maximize it and maximize the amount my wife receives in the event I die first. I also admit that my financial situation (manageable living expenses, a pension and the opportunity to work part time at a job I loved) made it easy to wait.
a spousal benefit does not increase if you wait until 70 to claim it. While the worker’s own retirement benefit increases by 8% annually for each year they delay past full retirement age (up to 70), spousal benefits max out at 50% of the worker’s full-retirement-age amount
You are correct that the spousal benefit does not increase. My wife claimed her benefit based on her work history at her Full Retirement Age. Her total benefit increased when I claimed when I reached 70 since her spousal benefit was more than her earned benefit.
Did you ever add up the money you left on the table to age 70 and what you could have done with it?
You made 8% (yes adjust for taxes avoided) in muni’s?
How is “money left on the table” different from doing the break-even calculation that you don’t like? Folks make this decision for all kinds of reasons. I chose to take SS at 70 so that my wife, who is five years younger than me, will receive a higher benefit once I croak.
a spousal benefit does not increase if you wait until 70 to claim it. While the worker’s own retirement benefit increases by 8% annually for each year they delay past full retirement age (up to 70), spousal benefits max out at 50% of the worker’s full-retirement-age amount
So you’ve posted this reply at least three times in this thread. I’m not sure why. I’m obviously describing my situation, which addresses survivor benefit. I took my SS at 70 and she took hers at her FRA.
Are you me Jeff? Haha
Our situation exactly! Fortunate!
My husband and I claimed at FRA. We both wanted to keep working, but we used the SS payments to buy plane tickets and rent an apartment near our then infant granddaughter. Worked very well. Eighteen years later, we still have that apartment and are still buying plane tickets. No regrets.
Thanks for your post Andrew.
In Jonathan’s 10/18/2024 forum post Just the Facts he offered readers seven guidelines for claiming Social Security where he also wrote “the right strategy will vary from one person to the next, and it’s important not to get bulldozed into making the wrong choice”.
I agree.
Your post expands those guidelines by adding an eighth, that as you say “flexibility matters when life doesn’t go as planned”.
I also agree.
For those who have not yet made the claiming decision I would encourage them to know that the Social Security rules do have current limitations on the ability to change or reverse your social security claiming decision once made which generally becomes irrevocable 12 months after the initial entitlement.
My recommendation for most things financial that is still taped to the top of my old calculator – “Anything is possible, and the unexpected is inevitable. Proceed accordingly.” (From a strategic philosophy regarding friction, chance, and uncertainty in war, commonly attributed to the 19th-century Prussian general and military theorist Carl von Clausewitz)
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Best wishes for a happy retirement Andrew. Bill
Thank you Bill for commenting and sharing some words of wisdom. That’s what HD has always been about.
A few good things about claiming early:
If you make it to/past 83 you’ll be happy that you’re still alive.
And, at that age in life you’re highly likely to spend less than you did in your 60s and 70s–at least on fun things.
Good point Ben, thanks for sharing.
Andrew, terrific article. Unlike Dan and Kathy below, I did consider breakeven, although I was doing my weighing at age 65 (one year before FRA) versus waiting until 70. When that breakeven age came up about the same as yours, 84, I took the benefits.
I have no doubt that my decision was influenced by the same consideration as yours — my own terminal diagnosis ten years ago. Although a medical breakthrough reversed that situation and I’m fully healthy, I remained acutely aware of how life can end early. I’ve been enjoying my benefits for four years now. No regrets.
Glad you’re doing well.
Mike, thank you so much for sharing your personal story. I am so glad you are fully recovered and can enjoy your SS benefits.
So many great points made in this article, Andrew. Claiming Social Security truly is a personal decision. However, many people start with a conclusion—wanting to claim early—and work backward to justify it, instead of letting the big picture guide them.
I waited until 70, Chris filed at 64. I had a job I liked, I only worked hard from January 15 to April 15. I was more or less retired for the other nine months. Chrissy was getting burned out at her job. Her reduced SS income would have no effect on our lifestyle. The last of us to die will enjoy my greater benefit. I think the ‘big picture’ supported the decision for me to delay, and for Chris to claim early.
My wife and I did the same thing as you both did. She is 4 years younger than me and started taking her SS benefit at age 62 in 2011. At the same time, I claimed ONLY my spousal benefit at age 66 (I retired the previous year at age 65) so collected benefits on her earnings record for 4 years. Then in 2015 I claimed MY SS benefit at age 75 for a full 32% more than my FRA benefit amount! I am 81 now am very happy that my wife will collect my 4-year delayed SS benefit as her survivor benefit when I precede her in death, whenever that happens. 🙂
Oops, I claimed MY SS benefit in 2015 at age 70, not age 75.
Yes, I also collected my spousal benefit until age 70. Sadly, that option is no longer available to the youngsters.
Thank you Dan for commenting and sharing with us your own personal decisions. And you had a great job!
As David says, it is so sad that Jonathan didn’t get to enjoy his well-planned retirement. As I’ve written here before, I retired at 53 in order to travel “before I got too decrepit”, so I am a big proponent of carpe diem. However, I made a different decision about Social Security. I have never been interested in my “break even” date: what I wanted was the largest available basis for future cost of living adjustments. I waited until 70 and I won’t regret it whether or not I make it to break even.
Like you, I did not consider ‘break even’. To me, it did not seem relevant to our situation.
Same. Waiting til 70 for the highest possible COLA-adjusted benefit. Spouse will probably take hers at 62. If she were to predecease me I’d still plan to wait for 70.
Ditto. My goal remains to preserve the largest possible COLA’d annuity for my wife. If she were to pre-decease me, I’d take it immediately as I have a decent pension and am comfortable w both managing our portfolio and adjusting my lifestyle as needed.
Right. My friends who claimed early complained that their ‘raise’, they don’t call it COLA, was eaten up by the increase in the Medicare premium.
Me? Due to my waiting to claim, I did just fine.
Great post, Andrew! There is an ongoing debate here on Humble Dollar regarding Social Security benefits and how to balance that break-even point with what you called “when the future becomes uncertain”: should a person take SS early so as to have the money earlier in retirement years when additional travel and etc. might cause higher expenses or should a person wait until 70 for the maximum benefit amount making it easier to afford potential higher medical expenses and/or leave an enhanced spousal benefit? I believe this is a very personal issue. I know how my wife and I fall on that continuum, and you have explained yours very well!
Thank you Dave for commenting and sharing your story. It’s definitely a personal decision and one you have to be comfortable with.
Andrew, thanks for writing this. I was nodding along at several of your points b/c we have been through similar things the past few years. Retirement isn’t just numbers and spreadsheets, life can get in the way. We ended up taking SS about the same timeline as you. We are grateful for it. Chris
Thanks Chris, I had to read your first sentence twice, I thought you were nodding off as you read my article! Phew.
LOL! C
Andrew other than the emotional toll on your family another sadness with Jonathan’s passing is that he spent so much time teaching people how to retire with financial safety to be able to enjoy a long retirement that he didn’t get to experience for himself.
Now knowing him as much as I do I can’t imagine that he would have stopped his writing and editing until at least his 90s if he had been so blessed because it was a huge part of his being.
However he also taught us how money is not just for stacking bills higher and higher on a pile, but how it is a tool to enjoy living while we are alive, which he did.
Thank you David, Jonathan was very proud of HD and yes I believe he would have kept it going although he may have cut back on it. He told me he spent 60 hours a week on it.
60? Wow. That’s the mark of a passion, a true calling.
That’s exactly why the pundits who say you always wait are just clueless. You should wait as late as possible if you need the money to survive. If you have nothing else else saved then early retirement should not even be in the picture. If you have other assets and social security is not critical to your day to day survival, then I see nothing wrong with taking it earlier than FRA or even 70. I have responded here many times that I’ll take it earlier and leave my retirement assets to my heirs. I can’t do that with social security. Some may not agree but I am 100% certain this is the right path for me.
Mike,
That was exactly our thought process.
Our heirs can inherit our assets. But not our SS. (or other pensions for that matter).
We want to leave as much as we can to our children, grandchildren and – with luck – great-grandchildren.
Others can feel and act differently.
That’s GOOD!
Mike you mention that you cant leave Social Security to your heirs but in my case that is what I hope to do. My ex-wife will benefit if I delay and my current wife will also benefit if I delay to age 70. My current wife is much younger than I am so her survivor benefit should last for many years. But I agree it is all about personal circumstances.
Hi James, totally get it. In our case we are the same age and almost have too much saved for retirement. We won’t know how to spend it, just not in our DNA. That’s what makes.each individual’s circumstance unique.
Thank you Mike for your wisdom,
makes sense to me.
Andrew, a really grounded perspective. For me, it all comes down to understanding what your personal “enough” looks like. Beyond that point, the siren call of “more” risks optimising the joy out of early middle age and retirement.
I retired at 58 during my peak earning years — financially, you could argue that’s a significant mistake. But I’d already accumulated more than my personal “enough,” and life has more to offer than an ever-growing financial buffer.
Debating social security claiming strategy when you’ve already hit your own definition of “enough” is like arguing how many angels fit on the head of a pin.
Thank you, as always Mark, for your comment. You are correct to say we all have our own definition of enough, I’ve always been conservative in my spending and happy with what I have, and that has allowed for a comfortable retirement.
“Retirement planning isn’t just about numbers. It’s about time, time we assume we’ll have, but aren’t guaranteed.”
Absolutely!!!
Life has always and will be about time.
I sprouted something about this in college during a meeting and got so many deer in the headlight looks you’d thought I was some alien!
The one thing none of us can buy is more time. It’s relentless tick of that clock that hones most of what everyone here is doing in our planning and execution of plans. We are all trying to make sure we can enjoy the ticks…responsibly as citizens of this planet. There’s a Trek:TNG quote that’s lodged in my head for decades. Something akin to: “Space, time and thought are not the separate things they appear to be.” Peace.
Thank you for your thoughtful comment. For the time being I’ll continue with life one day at a time, it’s worked well for me, so far!