When should you claim Social Security retirement benefits—and why?

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Joe D'Alessandro
Joe D'Alessandro
5 months ago

I’ve always read it’s best to wait until 70 to claim. I planned retirement not needing social security at all. I have two government defined benefit retirement plans (one with a guaranteed COLA escalator), government paid health insurance when I retire at 62 to carry me to Medicare, and a deferred comp (403b and 457b) balance in the seven figures. When I mentioned to my financial advisor that I guess my wife and I will wait until 70 to claim, he agreed I don’t need it, and said why don’t I just take it at 62 and spend it? Enjoy the money. I never looked at it that way before and that made sense to me. I ran the numbers and I would have to live to 78 before I would “loose” money by taking early. But the early retirement years are the healthiest. I still think for most people, delaying is best if they can. But it’s really situational.

8 months ago

There is no one way for this. It all depends on your situation. Like your age and health. The need for the money due to job loss. This goes for spouses also. Everybody seems to talk about waiting till your 70, but for a lot of people that’s just not possible. So again there is no one size fits all. It’s what works for you and yours.

11 months ago

I’ve modeled this question pretty thoroughly for our situation, with me eligible this year, and wife 8 years younger. We have a good sized nest egg built up, and don’t “need” the SS money to do what we want to do when she retires in the next 12 months.

We both have good family longevity histories. Using that to establish a planning age, I modeled the total combined cash payouts we’d receive at various permutations of claiming age and mortality age for both of us.

Ignoring unlikely scenarios (e.g., we both die at 70, which would be over 20 years earlier than expected), I looked at the difference in total payout for the various permutations, and concluded that it would be at most around 14%, and more likely less than 10% less than the calculated maximum (both claim at 70; both live to max planning age).

Based on that, I’ve concluded that the amount we’d “give up” by taking an early claiming strategy for me and a wait and see approach for her is not enough to worry about. For us, it’s more important to have fun early in retirement and minimize the anxiety caused by decumulating our nest egg and watching its balance fluctuate solely on returns and interest/dividends.

I encourage everyone to look at total expected return of their SSA payments and decide whether a delayed claiming strategy is worth the extra money versus an early strategy with its reduced decumulation stress.

1 year ago

Sorry for the length of this post. This is an area of great interest to me over my 40+ years of experience in corporate employee benefits.

Mike Piper is a great resource – see his book It was at my library.

See also recent Morningstar post:

I like Steve Spinella’s comments. And, I would add a second, perhaps related “freedom” consideration.

Some have the freedom to consider delayed claiming due to their combination of pension and Social Security (@ age 62 or whatever age they decide to start retirement income payouts) where they would have guaranteed, inflation-indexed income that was more than adequate to meet everyday financial needs in retirement (the retiree and her spouse (if any)). For those individuals, delayed claiming becomes an investment decision, not one that affects the household’s ability to maintain their pre-retirement standard of living.

Without that “freedom”, delayed claiming should always be a consideration. That is, delayed claiming should be considered as an alternative to the purchase of a single premium immediate annuity or other forms of insurance that can be structured to provide guaranteed, inflation-indexed income.

To that end, Congress could incorporate a variety of behavioral economics prompts/choice architecture in the claiming process. So, beneficiaries would retain full control, but, they aren’t left to their own devices and biases.

There are many reasons why I feel the federal government needs to provide more structure and guidance. Here are two:


Steve Spinella
Steve Spinella
1 year ago

A couple assumptions:
1) We only consider this question if we have the freedom to wait.
2) If we have the freedom to wait, it probably doesn’t matter. Lucky us!
Therefore, wait. It’s a small form of longevity insurance.
And if we can’t stand waiting? This is probably not our biggest problem.

Mike Zaccardi
Mike Zaccardi
1 year ago

In general, deferring to age 70 makes sense to reduce longevity risk. As with many aspects of financial planning, managing risk is extremely important. While it might be more likely you’ll make out better by taking it before 70 (i.e. if you are a black single male who is likely to live shorter than a married white woman), you still need to be considerate of the chance you live a long time.

And it can make even more sense for a healthy couple to delay taking benefits due to the higher chance at least 1 will live to 90+. Today, a 65yo couple has a 49% chance 1 will live to 90+!

Last edited 1 year ago by Mike Zaccardi
R Quinn
R Quinn
1 year ago

When you absolutely need the income and not before and especially not early under the illusion SS won’t be there for you later.

1 year ago

One of the best (if not the best) Social Security calculators to answer this question is provided by Mike Piper for free here:

Edwin Belen
Edwin Belen
1 year ago
Reply to  johntlim

Echo this but am trusting as I can’t figure it out myself.

Steve O
Steve O
1 year ago

SS as per an actuary example suppose individual would receive:
$1500 per month at 62
$2000 per month at 66
$2700 per month at 70
Then calculate using the mortality tables go to 110.
The actual mortality adjusted present values are as follows:
At 62 $375,138
At 66 $319,110
At 70 $363,561
Notice all the numbers are basically the same.
In my opinion forget break even because the following are not considered;
subtraction of not taken SS benefit
15% SS federal tax savings
Fun when you are younger !!!!!

The only reason to wait to 70 is to assure larger benefit for remaining spouse.

We split the difference for SS C at 62, S spousal at 65 then S at 70.
S waiting to 70 assures larger benefit for C when S passes.
The joint survivor pension and S 70 SS yields annual $100 k for C.

We retired at S 62 and C 59.
Action use 12% IRS bracket to harvest DRIP capital gains tax free until 70.

Since 1/1/16 retirement portfolio up by 1 million with (30 S, 60 B, 10 C)
Now (15 S, 55 B, 30 C) adjust after the stock cliff falls into the ocean
Why play the stock cliff game when you already won, scuba the ocean.

Now with scamdemic no travel or scuba so no need for travel money.
Planting a large garden for grand solar minimum.

9-30-2015 to March 2020 we traveled nine months each year.
This is an excellent example of why we retire to have fun.

Now governments take away our freedoms for unscientific reasons.
The same evil governments could take away SS for no reason.

Another example which closely fit our situation :

Last edited 1 year ago by Steve O
1 year ago

Unless you have reason to believe you are not long for this world, avoid the “haircut” for the four years prior your Full Retirement Age. Especially if you are currently making good money and can keep that going those last years. You’ll get 35% less at 62 than your FRA benefit, if you were born in 1960 or later.

Between FRA and 70, it depends.

Your ultimate benefit rises each year in large measure because you also lose the money you would have collected. My brother likes to compare it to a sheet of paper. At 66, your paper is 8 1/2″ tall. At 70, the paper is turned 90 degrees and now 11″ tall. Roughly the same amount of money (the area of the sheet of paper) comes your way, actuarially. Planning as an individual, you reach a crossover in your early 80’s when it turns out that it’s better to have started later. But if you don’t live long, then you’ve left your contributions on the table.

David Powell
David Powell
1 year ago

I’m aiming to start after full retirement age, ideally at 70. Where else can you find a near-certain 8% increase/year on a low-risk, inflation-adjusted income stream? With advances in diet, fitness, and medicine translating into long-term increases in U.S. longevity, delaying Social Security is one way to hedge the risk that we will outlive our retirement savings.

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