We Are Rethinking Our Social Security Claiming Strategy
Category: Social Security
September 18, 2025 – Anyone who has been following Topretirements for a while knows that we are a big proponent of delaying taking Social Security benefits as long as possible. But maybe is time to change that position.
Up to now the advantages of waiting to claim Social Security retirement benefits to age 70 have been pretty clear (for most people). For every year you wait to claim after age 66 you get an 8% increase in your benefits, up to age 70. Delaying has a second benefit because ir raises your COLA $ increase be every year. And, if your spouse’s benefit isn’t as high as yours, he or she will get your higher benefit for the rest of their life at your passing. If your finances are tight, all these advantages could be worth a lot. On the other hand, for people and couples who have a very short remaining life expectancy, or who need the money now to survive, it might not be a good idea to wait.
So what has changed?
We have been warned for years that the Social Security Trust Funds are going to be exhausted early in the next decade. The predicted year changes, but the latest forecast is for 2033, less than 8 years away. All kinds of experts have warned that unless something is done, only a little more than 70% of benefits will be available to be paid after that. Meanwhile, despite politicians of all stripes promising to protect Social Security, none of them have done anything about it.
Our first reason for thinking that maybe you might be better off claiming early is related to that problem – nobody is doing anything. Although there are fixes that could solve the problem (raise how much we pay into the system, tax all income, etc.), few politicians have had the courage to propose or vote for them. As 2033 gets nearer and nearer, the ability to fix the problem gets harder and harder.
Secondly, while Social Security benefits are still taxable over certain levels, the One BIg Beautiful Bill introduced a temporary deduction that allows eligible beneficiaries to lower their overall taxable income. The new, additional $6,000 deduction for individuals aged 65 and older means that fewer seniors will pay income taxes on their Social Security benefits. Since a portion of the tax revenue from Social Security benefits helps fund the program’s trust funds, this reduction means less money is flowing into the system, accelerating when the Trust Funds run out of money.
Thirdly, our rapidly increasing national debt, exacerbated by tax cuts for corporations and the ultra-wealthy, is not going to help. As the debt increases, so will the amount of interest paid to service it. Rates could go up too as the government’s need for cash expands. The final effect of our debt is that it reduces our ability/willingness to buy our way out of the problem and pay promised benefits. The shortfall is going to be enormous, probably more than any government will be willing to pay.
The bottom line
Millions of Social Security beneficiaries are probably going to see around a 30% reduction in their benefits in just a few years. The well off will be able to weather it, but many others will not. As of May 2025, the Social Security Administration (SSA) estimated that more than 40% of recipients aged 65 and older depend on these payments for at least half of their income. The human suffering is going to be immense.
Some rough calculations
Which brings us back to where we started. Maybe you are better off grabbing the money now instead of claiming later. You can do the math based on your own expected benefits (AI can help with the calculations), but here is one back of the envelope sample.
Expected benefit at age 66: $3000/month – $36,000 year
If you claimed at age 66 your benefit would amount to $36,000 now. A 30% reduction in 2033 would cut your annual benefit of $25,200, a $9,000 reduction. Prior to 2033, if you wait to age to age 70 to claim your benefits, the 8% increase per year means your $3,000 benefit would rise to $4081/month ($49,000/year), not bad. But if you only get 70% of that after 2033, your benefit would decline to $2,856/month, or about $30,000 year, less than you would have gotten if you claimed at age 66. That’s a pretty big difference.
Worth the wait?
If you took the $3,000 at age 66 you would have received 3,000 for a total of $144,000 over 4 years. By waiting to age 70 you would be forgoing that amount until then, and hoping to make it up by living a long time. The math seems hard to work.
Bottom line:
You can do your own calculations to see what works better for you. Or, you can bet that our politicians can either get their act together now and fix the problem, or bail us out with the general fund starting in 2033. As each day with no solutions coming forward, we are increasingly sceptical.
Comments? Let us know your thoughts in the Comments section below. Have you changed your mind?
Comments on "We Are Rethinking Our Social Security Claiming Strategy"
RichPB says:
What is often not said is that, in addition, inflation will also bite into that cut much more by 2033. We know the CPI is not a true indication of inflation because key costs aren't included (like oil/gas). If our portion of fixed income is lower due to inflation, how does that impact?
Brad says:
You are assuming too much. The system, I mean all of it is solvent. Why peddle fear? You assume that what you were taught/learned was factual. It wasn't and isn't.
Daryl says:
I remember sitting in the social security office at age 63, asking whether I should take it now or wait until later for a bigger check (the old marshmallow test.) The guy at the desk ran the numbers, calculated the break even point, and said “I’d take the money and run.” Now I’m glad I did.
Stevo says:
My guess is that the Fed will means test your amount so that people who get small payouts will be ok and those who have more of other retirement income will get less. I think SS is the least of our worries. The federal debt is the elephant in the room and if something isn't done about that there will be major issues for everyone. History has seen this scenario repeat over and over again.
Chuck says:
I've been tracking whether to take SS early, at my FRA or wait until 70. The breakeven point for both me and my wife (everyone?) is roughly age 82. If you live past 82, you win. If you die before then, SS wins. We're betting on a long life as we're both reasonably healthy. Plus, if our representatives in Washington don't have the intestinal fortitude to fix SS, getting 70% of our benefits puts us back at a bit less than what we would have gotten at our FRA, which is still better than 70% of the FRA. That works for us, but everyone's situation is unique.
Louise says:
Daryl, I am totally with you! Took mine early and never looked back!
Another thing to think about is if a married couple waits and one spouse dies before either collected, the living spouse will only be able to collect on the one highest SS check. Meaning the money he or she could have collected can never be drawn. That money that could have been collected between age 62-70 is no longer an option.
Here is an example I asked Microsoft Copilot to do a comparison to show how both spouses waited till age 70 to draw and another couple who collected early. Both had a spouse that died around 70 years old.
Let’s walk through a clear, side-by-side example of two couples—one who claims Social Security early, and one who waits until age 70—to show how survivor benefits and lifetime income play out when one spouse dies shortly after turning 70.
? Assumptions for Both Couples
Both spouses worked and qualify for Social Security.
The higher earner’s full retirement age (FRA) benefit is $2,000/month.
The lower earner’s FRA benefit is $1,400/month.
Full Retirement Age is 67.
One spouse dies at age 70, shortly after claiming.
Survivor receives the higher of the two benefits, not both.
? Couple A: Claimed Early at Age 62
Higher earner gets $1,400/month (30% reduction from $2,000)
Lower earner gets $980/month (30% reduction from $1,400)
Combined monthly income: $2,380
Over 8 years (age 62–70):
Total received: $228,480
After one spouse dies at 70:
Survivor receives $1,400/month
If survivor lives to 85 (15 more years):
Survivor income: $252,000
Total household income over 23 years: $480,480
? Couple B: Waited Until Age 70
Higher earner gets $2,480/month (8% x 3 years = 24% increase)
Lower earner gets $1,732/month (same 24% increase)
Combined monthly income: $4,212
Over 1 year (age 70–71):
Total received: $50,544
After one spouse dies at 71:
Survivor receives $2,480/month
If survivor lives to 85 (14 more years):
Survivor income: $416,640
Total household income over 15 years: $467,184
?? Comparison Summary
Metric Couple A (Early) Couple B (Delayed)
Dual income years 8 years 1 year
Survivor income $1,400/month $2,480/month
Total household income $480,480 $467,184
? Key Takeaways
Couple A gets more total income over time because they had 8 years of dual checks, even though the survivor’s benefit is lower.
Couple B gets a much higher survivor benefit, but loses out on 8 years of dual income—and if one spouse dies early, the delayed strategy never fully pays off.
The longer both spouses live, the more delaying benefits becomes advantageous. But if one dies early, early claiming can be the better hedge.
Admin says:
One thing to consider is if you are deciding to take Social Security now, or if you have already been on it for several years. In the latter case, you will still probably be further ahead if you or your spouse live past 85, even with the cut that comes in 2034. That's because you have already collected so much before the cut comes. But if you are on the verge of collecting or many years away, you might want to consider claiming now so you get more years before the cuts (if they come!).