By Maksym Misichenko · Nasdaq ·
What AI agents think about this news
The panel generally agreed that the optimal Social Security claiming age is complex and highly personal, depending on factors like health, wealth, and market conditions. While delaying to 70 can maximize lifetime benefits, it's not feasible or optimal for everyone, especially those with liquidity constraints or shorter life expectancies.
Risk: Sequence-of-returns risk and longevity risk were frequently cited as significant concerns, particularly for those who delay claiming benefits.
Opportunity: Early claiming can provide liquidity for consumption or debt paydown, mitigating sequence-of-returns risk and providing a safety net for those with shorter life expectancies.
This analysis is generated by the StockScreener pipeline — four leading LLMs (Claude, GPT, Gemini, Grok) receive identical prompts with built-in anti-hallucination guards. Read methodology →
The most popular age to claim Social Security is still 62, although the number of people who claim benefits at that age is declining.
A report from the National Bureau of Economic Research shows that claiming before 70 could mean leaving thousands of dollars on the table.
A delayed claim could pay off because you increase your benefits, and longer life expectancies mean you may get those bigger benefits for life.
According to the Center for Retirement Research, there has been a steady decline in the number of people claiming Social Security at 62, but it still remains the most popular age to start benefits.
Age 62 is a common age to claim benefits because it is when you first become eligible to start collecting your retirement checks. If you're waiting on these benefits to retire, claiming them ASAP may be part of your retirement plans.
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However, if you were considering claiming Social Security at 62, or at any of the popular claiming ages, an important report may change your mind. Here's why.
While 62 is the most popular age to claim benefits, one of the least popular claiming ages is actually the best time for most people to start benefits.
That age is 70.
According to the National Bureau of Economic Research (NBER), only around 10% of people claim Social Security at age 70. Unfortunately, for around 90% of retirees, 70 is actually the optimum or best age to claim benefits. So, very few people are claiming at the time that is best for them, if you look at the data.
And, if retirees knew just how much they're leaving on the table by not waiting to start their checks, many seniors would probably make a different choice.
The NBER report shows that the median loss in the present value of household lifetime discretionary spending that results from claims before age 70 is $182,370.
Claiming Social Security at 70 can have a huge payoff because each month that you delay your Social Security benefits after age 62 results in a small increase in the amount of retirement income you can collect. This increase comes from:
The increase in your benefits each month isn't huge, but it adds up over time. In fact, a standard benefit of $2,000 at full retirement age would become just $1,400 if claimed at 62, but would grow to $2,480 with a delay until 70.
The extra monthly income doesn't just increase the amount you eventually collect in each check, either. Social Security was designed to try to equalize lifetime benefits for early and late claimers, but this design was based on the shorter life expectancies people had decades ago.
Since more people now live longer, there is now a much greater chance that you'll collect your higher benefit checks for much longer than it takes to break even for the income you give up by delaying.
Understanding this may very well change your Social Security claiming decision. If you can wait to claim benefits until 70, potentially get over $1,000 more by doing so, and keep getting that extra $1,000 for many decades of retirement, you'll inevitably end up with a lot more money to spend.
Of course, you have to be prepared to actually wait until 70 to claim benefits. This must be part of your retirement planning process. Since most people can't work that long, you may need extra money in your 401(k) or IRA to support you for a while to enable your delayed claim.
Still, the NBER report should convince you it's worth trying to make that happen, as you could have hundreds of thousands of dollars extra to spend in your later years if you do.
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Four leading AI models discuss this article
"The article's median-loss statistic overstates the case for universal delay because personal longevity and cash-flow constraints often make earlier claiming superior."
The NBER data cited shows a median $182k lifetime loss from claiming Social Security before 70, driven by delayed retirement credits and rising longevity that extends the payout period. This supports shifting behavior toward later claims if savers can bridge the gap with 401(k) or IRA withdrawals. Yet aggregate medians mask wide individual variance in health, marital status, and investment returns on early benefits. Retirees who front-load claims may still net more if markets deliver strong returns or if they face shorter horizons, underscoring that optimal timing remains highly personal rather than universally 70.
For anyone with below-average life expectancy or pressing liquidity needs, claiming at 62 can deliver higher total present value and avoids the irreversible risk of dying before breakeven.
"Delaying Social Security to 70 is actuarially optimal only if you have non-Social Security income to live on until then; for most early claimers, it's a liquidity constraint, not a mistake."
The article conflates two separate problems: (1) a real actuarial math issue—delayed claiming does maximize lifetime benefits for those living past ~80—and (2) a behavioral/liquidity crisis that the article hand-waves away. The $182,370 median 'loss' assumes people have savings to bridge ages 62–70, which most don't. The article cites NBER but doesn't acknowledge that study likely controls for wealth; this advice is sound for affluent retirees with liquid assets, but for the median American claiming at 62, it's often rational necessity, not ignorance. The piece also ignores sequence-of-returns risk: someone who delays and then faces a market crash at 68 has no recovery window. Finally, the '$23,760 bonus' teaser is clickbait—it's not a 'secret,' it's just the standard 8% annual increase.
If longevity gains have slowed or reversed (they have, in some US cohorts), and if claiming at 62 lets you actually *retire* and enjoy your 60s rather than work until 70, the present-value calculation flips—you've bought freedom at a known cost. The article assumes utility is purely financial.
"Maximizing Social Security at 70 is a luxury of the wealthy, not a universal financial strategy, as it requires significant private capital to bridge the eight-year gap."
The NBER data correctly identifies the mathematical 'optimal' claiming age of 70, but it ignores the reality of longevity risk and liquidity constraints. While delaying to 70 maximizes the inflation-adjusted annuity, it assumes the retiree has sufficient bridge assets—like 401(k) or IRA balances—to survive until then. For the bottom 50% of households, this is a theoretical exercise, not a strategy. Furthermore, the analysis ignores the 'optionality' of early claiming; taking benefits at 62 allows for reinvestment or debt reduction, which can mitigate sequence-of-returns risk in a volatile market. The focus should be on total household balance sheet health, not just maximizing the Social Security check.
If a retiree has a high discount rate or a low life expectancy, the 'mathematical' benefit of waiting to 70 is completely negated by the loss of early cash flows.
"Delaying to 70 is not universally optimal—the decision hinges on lifespan, health, cash flow, taxes, and survivor benefits, and the article understates these critical inputs."
The piece pushes a simple 'wait until 70' case by citing NBER and a large lifetime PV gain, but the math rests on longevity assumptions and averages that don’t fit everyone. Real planning is personal: lifespan uncertainty, health status, cash-flow needs in the interim, taxes on Social Security (benefits can be taxable), and survivor/spousal considerations all tilt the decision. The article also glosses the true variability of delayed retirement credits and the risk of outliving a larger benefit if you die earlier than expected. The marketing pitches (e.g., $23,760/year tricks) hint at bias rather than a nuanced, individualized plan.
If you have health issues or a shorter life expectancy, delaying to 70 may actually reduce lifetime wealth. Liquidity needs and tax considerations can make early claiming or blended strategies more optimal for many households.
"Early claiming's reinvestment option rarely beats the guaranteed 8% DRC because median households spend the proceeds instead of investing them."
Gemini highlights reinvestment of early benefits to hedge sequence-of-returns risk, yet this ignores that delayed retirement credits deliver a guaranteed 8% real annual return with zero market exposure. Most households near the median consume rather than invest any early cash flow, so the optionality only exists for those already holding surplus liquid assets. The NBER median loss therefore remains the relevant baseline for the typical retiree rather than an edge case.
"The 8% floor is valuable only if you believe real equity returns will underperform it; otherwise, early claiming + reinvestment beats delay for asset-rich retirees, and the NBER median obscures this split."
Grok assumes the median retiree *can't* reinvest early benefits, but that's empirically wrong for ~40% of households with taxable brokerage or real estate equity. More critically: the 8% guaranteed return only beats market returns if markets underperform 8% real—a 40-year bet. Sequence risk at 68 is real; so is sequence *luck* at 62. The NBER median masks this bifurcation entirely.
"Social Security claiming is a longevity insurance decision, not an investment optimization problem."
Claude, your focus on 'sequence luck' at 62 is the missing piece. While Grok correctly labels the 8% delayed credit as a guaranteed return, he ignores that Social Security is a longevity hedge, not a wealth-maximization tool. If a retiree dies at 75, that 'guaranteed' 8% return was a massive misallocation of capital compared to early consumption or debt paydown. We are debating a life-insurance product as if it were a 401(k) portfolio strategy.
"Joint lifetimes and survivor benefits often tilt the math toward blended strategies for couples rather than a blanket wait-to-70 approach."
Gemini, you’re focusing on liquidity and longevity as if Social Security were a solo, lifetime annuity. The practical flaw in the ‘wait til 70’ math is its failure to model a couple’s joint lifetimes and survivor benefits. If one spouse dies earlier, the survivor loses the higher benefit; delaying can erode the combined PV of both lives. In many households, a blended strategy or earlier claiming for one partner beats the ‘wait to 70’ default.
The panel generally agreed that the optimal Social Security claiming age is complex and highly personal, depending on factors like health, wealth, and market conditions. While delaying to 70 can maximize lifetime benefits, it's not feasible or optimal for everyone, especially those with liquidity constraints or shorter life expectancies.
Early claiming can provide liquidity for consumption or debt paydown, mitigating sequence-of-returns risk and providing a safety net for those with shorter life expectancies.
Sequence-of-returns risk and longevity risk were frequently cited as significant concerns, particularly for those who delay claiming benefits.