The $100,000 Retirement Mistake: Why Delaying Social Security Can Lead to Bigger Benefits
When it comes to claiming Social Security, many retirees opt to take benefits as soon as they become eligible at age 62.
However, waiting to claim until full retirement age—or even delaying until age 70—can significantly increase your monthly payments and long-term financial security.
Here’s why postponing Social Security might be one of the best retirement strategies.
1. Higher Monthly Payments
The biggest advantage of delaying Social Security is the increase in benefits. If you claim at age 62, your monthly payment is reduced permanently.
However, for every year you delay beyond Full Retirement Age (FRA), your benefits grow by about 8% per year, up until age 70.
- Claiming at 62: You receive only about 70-75% of your full benefit.
- Claiming at Full Retirement Age (66-67): You receive 100% of your benefit.
- Claiming at 70: You get 124-132% of your full benefit.
For example, if your FRA benefit is $2,000 per month at 67, waiting until 70 could boost it to $2,640—a significant difference that adds up over time.
2. Increased Lifetime Earnings
While claiming early might seem appealing, those who live longer could miss out on thousands of dollars.
Someone who waits until 70 to claim and lives into their 90s could earn tens of thousands more in Social Security benefits compared to someone who claims at 62.
More about Social Security:
- MAJOR Social Security Changes in 2025: How They Impact Your Benefits
- Social Security Fairness Act: Millions to Receive $6,710 in Retroactive Payments
- March Social Security Payments Could Be Your Biggest Yet – Are You Getting $5,180 or $5,108?
3. Larger Survivor Benefits for Your Spouse
Delaying Social Security not only helps you but can also benefit your spouse.
If you pass away, your spouse may receive your full Social Security benefit.
A higher delayed benefit ensures your surviving spouse has a stronger financial cushion.
4. Helps Combat Inflation
Social Security benefits include an annual Cost of Living Adjustment (COLA), which increases payments to keep up with inflation.
Since COLA is based on your benefit amount, waiting to claim results in larger COLA-adjusted increases over time.
Combat inflation:
- $6,500 Housing Bonus to Help Families Struggling with Inflation
- Help on Inflation: Here's a Fact Sheet on the Housing Choice Vouchers
5. Reduces the Risk of Running Out of Savings
Delaying Social Security means you’ll need to rely on personal savings for a few extra years, but once benefits start, they provide a guaranteed lifetime income.
This can help reduce the risk of depleting your retirement savings too quickly.
When Claiming Early Might Make Sense
While delaying is often beneficial, early claiming can be a good option if:
- You have health concerns that might shorten your lifespan.
- You need Social Security to cover essential expenses immediately.
- You have no other income sources to rely on before full retirement age.
Bottom Line: Delaying Pays Off
For most retirees, waiting to claim Social Security—especially until age 70—can result in significantly higher lifetime benefits.
If you have other sources of income to cover early retirement expenses, postponing Social Security is a powerful way to maximize your financial security in later years.
Previous article: Higher Social Security Payments for 62-Year-Old Retirees in March 2025
-
Don’t miss out on the latest updates and insider tips that can supercharge your financial and entertainment life.
