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The Best Way to Encourage People to Collect Social Security at 70



The Best Way to Encourage People to Collect Social Security at 70

The Best Way to Encourage People to Collect Social Security at 70. A recent publication from the Schwartz Center for Economic Policy Analysis at the New School in New York sheds light on strategies to encourage later collection of Social Security benefits, with a focus on the age of 70.

The report explores various “Social Security Bridge” approaches to incentivize retirees to delay claiming benefits and provides insights into why some seniors opt for earlier withdrawals. Additionally, it proposes policy solutions to address these challenges.

Suboptimal Benefit Claiming Trends

Despite age 70 being a financially superior choice for most individuals, over 90% of seniors initiate their Social Security benefits before reaching this age. The report emphasizes that waiting until age 70 is generally a better decision, except in cases of urgent financial need with no alternatives.

Ramifications on Retirement Security and Survivor Benefits

The report underscores the ripple effects of early benefit claiming, not only affecting one’s retirement security but also impacting the financial well-being of dependents. Survivor benefits are intricately tied to the beneficiary’s age when initially claimed, amplifying the significance of delaying benefits until age 70.

Financial Impact Illustrated

Using the example of a hypothetical retiree born in 1960, the report illustrates the financial disparities associated with different claiming ages. Waiting until age 70 can result in significantly higher monthly benefits compared to claiming at age 62 or 67, reinforcing the financial prudence of delayed claiming.

Policy Recommendations for Encouraging Delayed Claiming

The report proposes several policy recommendations to foster a culture of delayed claiming. One notable suggestion is enhancing the communication of Social Security’s age structure, emphasizing the opportunity costs of early collection for both individuals and their survivors. A Senate bill, proposed in March, aligns with this recommendation by advocating for regular mail communication from the Social Security Administration, informing workers of their earning history and potential benefits.

Terminology Adjustment and Legislative Measures

The report suggests revising the terminology associated with Social Security claiming ages to better reflect their implications. A bill in the Senate recommends renaming age 62 as the “minimum benefit age,” age 67 as the “standard retirement age,” and age 70 as the “maximum retirement age.” These adjustments aim to provide clearer guidance to individuals considering when to claim their benefits.

Addressing Retirement Savings Gaps

Recognizing that inadequate retirement savings often drive early benefit claiming, the report supports the Retirement Savings for Americans Act. This legislation proposes the creation of a federal automatic individual retirement account, potentially with a government match of up to 5%. Such measures aim to alleviate the financial strain that leads individuals to claim benefits prematurely.

State-Level Initiatives

In line with these recommendations, some states, including Maryland, are exploring the incorporation of a Social Security bridge element into their retirement savings programs. This proactive approach at the state level aligns with the broader goal of encouraging delayed claiming.

Structuring Defined Contribution Plans for Optimal Social Security Value

For those with retirement savings plans, the report advises structuring defined contribution plan payouts to mirror Social Security payments from ages 62 through 69. This strategy seeks to minimize the incentive for early collection, allowing retirees to maximize the overall value derived from Social Security benefits.


The report from the New School provides a comprehensive analysis of the challenges associated with early Social Security benefit claiming and offers a set of thoughtful policy recommendations to encourage delayed claiming, ultimately enhancing the financial well-being of retirees and their dependents.

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