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90% of Americans break this Social Security 'rule' — here's why they're right

Kat AokiDecember 27, 2025 at 1:42 AM

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90% of Americans break this Social Security 'rule' — here’s why they're right (Jose Luis Pelaez Inc via Getty Images)

If you've ever sat through a retirement planning seminar or scrolled through personal finance advice online, you've probably heard the golden rule: delay claiming Social Security as long as possible, ideally at age 70, before you start collecting those checks.

Cue the record screech: Nearly everyone — we're talking 90% of Americans — are planning to ignore that advice, according to a new Schroders survey. And before the financial experts start clutching their pearls, it turns out there are some pretty good reasons why.

Here's the kicker: Most folks know exactly what they're giving up by claiming early and aren’t buying what the financial industry is selling — and for millions of Americans, that's perfectly OK.

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The retirement math that makes advisors swoon

Let's explain why financial planners are so obsessed with the "wait until 70" strategy. You can start claiming Social Security as early as 62, but doing so cuts your monthly payment by about 30%. That reduced amount? It's locked in for life.

On the flip side, for every year you wait past your full retirement age (now 67, for most workers), you get a hefty 8% bump in your monthly benefit. Wait until 70, and you could be looking at payments that are 24% higher than if you'd claimed at 67. Indeed, a study by the National Bureau of Economic Research found that filing early can cost you $182,000 in foregone payments over a lifetime.

But here's what that research doesn't always capture: If you delay from age 67 to 70, you're giving up three years of payments to get that 24% boost. The breakeven point — when the higher monthly checks make up for those missing years — lands somewhere between 80 and 82. Live past that, and delaying pays off. Don't make it that far, and claiming earlier would have put more money in your pocket overall.

So, yes, numbers may sound impressive on a spreadsheet. However, real life doesn’t always follow those same formulas.

🔍 Read more: The one Social Security step you need to take before 2025 ends

7 reasons 90% of us ignore the advice and claim early anyway

So why is nearly everyone ignoring the experts? The Schroders survey reveals people aren't confused — they're just being realistic about their circumstances.

Reason No. 1: Most people can't afford to wait

Sometimes you need money now, not bigger checks down the road. If it's a choice between claiming Social Security early or drowning in credit card debt to stay afloat, taking benefits early might actually be the smarter move.

Here's the rub: For many Americans, retirement savings are barely there. While baby boomers have an average $250,000 in their 401(k)s, Gen X trails behind at a little over $192,000. Millennials? They’ve saved an average $67,300 in their 401(k)s.

Social Security isn't bonus income – it's essential income. When you need money to pay the bills the moment you retire, waiting five to eight more years isn't an option.

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Reason No. 2: Your health might not cooperate

If you have a shorter life expectancy due to poor health or other risk factors, claiming early might mean you actually receive more total benefits over your lifetime.

Social Security's own math shows the breakeven point falls around ages 80 to 82. If you delay claiming from 67 to 70 and live past 82, those bigger checks add up to more total lifetime income.

But the average life expectancy is around 76 for men and 81 for women. If you don’t live to your 80s? You'll have received less money overall than if you'd claimed earlier.

🔍 Read more: 8 health insurance options for early retirees — before Medicare kicks in

Reason No. 3: Nobody trusts Social Security's future

Social Security's trust funds are projected to become insolvent by 2034. That doesn't mean payments stop. Even if Congress does nothing, incoming payroll taxes would cover about 77% of benefits.

But that nuance isn’t very comforting to those of us who are worried the money won't be there if we wait.

🔍 Read more: ‘Will Social Security run out of money?’ 5 common fears vs. facts

Reason No. 4: Life happens when you’re making other plans

As John Lennon wisely observed, life has a way of happening while we're focused on our carefully laid plans. A job loss at 63. A health scare that puts things in perspective. Suddenly, becoming the primary caregiver for aging parents or grandkids.

These aren't hypotheticals — they're the curveballs that force early retirement for millions of Americans, regardless of what their original plan looked like.

Research shows that some 50% of retired workers had to stop working before they expected, and 30% of people who retired early did so for reasons beyond their control.

In these moments, you might not care so much about your financial advisor’s “optimal claiming strategies.”

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Reason No. 5: You actually want to enjoy retirement

Here's a wild concept: Maybe you don't want to work until you're 70. Maybe you dream about hiking Machu Picchu, spending time with grandkids or pursuing new hobbies. If you've saved diligently over your 40-year career and can afford to claim early, why shouldn't you kick up your heels and enjoy life while you're still healthy enough to do it?

You could spend your 60s finally doing what you want, or you could spend them punching a clock while dreaming about retirement. For many people, the answer is clear — life is uncertain, so why gamble that you’ll be spry enough at 70 to enjoy those bigger checks you waited for?

🔍 Read more: Retiring soon? 7 things all smart boomers should sell first

Reason No. 6: You're working part-time under the earnings limit

The earnings test reduces benefits if you claim before full retirement age and earn above $23,400 in 2025 (or $24,480 in 2026). If you earn over that amount, Social Security deducts $1 from your benefit payments for every $2 you earn above this limit.

But if you're making less than that, claiming early while working part time could actually work in your favor. You might find that combo of income and Social Security plenty to live on, especially if you’ve paid off your mortgage and your kids are flown and grown.

It’s like a gradual off-ramp from the 9-to-5 that many people find ideal.

🔍 Read more: Still working past 65? The Social Security penalty hiding in plain sight

Reason No. 7: Marriage changes the claiming strategy

If you’re married, sometimes it makes sense for the lower earner to claim early while the higher earner waits. This strategy can maximize your household's lifetime benefits and provide income now while preserving the bigger benefit for later.

But there’s more: When one spouse dies, the other gets the higher of two Social Security benefits — not both. By splitting your claiming strategy, the larger amount becomes a kind of safety net for the surviving spouse.

Say your benefit is expected to be $1,200 a month, while your partner’s is $2,500. You can claim early and enjoy benefits right away. Now say your spouse waits until 70, growing their benefit to $3,000 or so. You’re now both collecting checks — and when one of you dies, the surviving spouse gets to keep that bigger $3,000 payment for life.

It can make the difference between struggling and living more comfortably as a widow or widowers.

🔍 Read more: Married ... or divorced? This little-known rule can boost your Social Security check

3 strategies for waiting to claim (without living on ramen)

If you're among the 10% of Americans who actually want to delay claiming, here's how to bridge the gap without going broke:

Lean on other retirement accounts first. Tap into your 401(k) or traditional or Roth IRA while letting your Social Security benefit grow. Think of it as getting an 8% guaranteed return for each year you wait. (Try finding that anywhere else these days!)

Pick up part-time work. Even a modest income from flexible work can help you delay claiming while keeping your skills sharp and your social calendar full. We also know some older folks like to work and have no intention of quitting.

Downsize or relocate. Moving to a lower cost-of-living area in the U.S. — or even a new country — might free up enough cash flow to wait a bit longer on Social Security.

📝 3 steps to calculate your breakeven point

Before you decide to wait, run the numbers for your specific situation.Here's how to calculate your breakeven point:

Take your projected monthly benefit at 67

Multiply that result by 36 months — or the number of payments you'd miss by waiting until age 70)

Then divide that number by the monthly increase you'd get by waiting

This calculation tells you how many months past 70 you'd need to live to come out ahead. For most people, that's anywhere between ages 80 and 82 — but benefit amounts can change the numbers.

🔍 Read more: 2 Social Security ‘do-overs’ almost nobody knows about

The bottom line: Your money, your timeline, your life

Personal finance advice is called "personal" for a reason. The ideal strategy on paper doesn't always match reality.

Yes, waiting until 70 maximizes your monthly Social Security check. But it also assumes you have the savings, health and job security to actually make it to 70 without needing that income. For most Americans, that's just not their reality.

There's no shame in claiming early if that's what works for your life. Just make sure you're making a strategic choice — and not a desperate one. Consider working with a trusted financial planner to run the numbers for your specific circumstances.

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About the writer

Kat Aoki is a seasoned finance writer who's written thousands of articles to empower people to better understand technology, fintech, banking, lending and investments. Her expertise has been featured on sites like Lifewire and Finder, with bylines at top technology brands in the U.S. and Australia. Kat strives to help consumers and business owners make informed decisions and choose the right financial products for their needs.

Article edited by Kelly Suzan Waggoner

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Source: “AOL Money”