Research shows delaying Social Security benefits until age 70 maximizes lifetime payouts, contrary to popular early-claiming trends.
A National Bureau of Economic Research study reveals that claiming Social Security benefits at age 62 instead of 70 costs retirees a median $182,370 in lifetime payouts. The findings challenge widespread early-claiming behavior, which 44% of surveyed adults prefer before Full Retirement Age.
Only 10% of respondents in a Schroders survey said they would wait until age 70 to file. The NBER paper argues that delaying benefits typically optimizes total retirement income, despite perceptions that early claiming is more advantageous.
Financial advisors often debate the trade-offs, but the data suggests a significant financial penalty for those who opt for early access to benefits.