Most Americans Miss Out on Maximizing Social Security Benefits

Just 8 percent of men and 8.6 percent of women who filed new Social Security claims in 2024 had waited until age 70 to maximize their benefits, according to the Social Security Administration. More than 90 percent of all new claims were filed by people younger than 70 that year. This stark reality highlights the disconnect between expert advice and the reality of many workers' financial situations. Blair Barondes and his wife, Janet Bowdan, are among those who have questioned the conventional wisdom of waiting until 70 to claim Social Security. After crunching the numbers, they calculated that waiting until 70 would not net them more over their retirement. "We're not trying to be contrarians, but we're trying to make the most of our situation," Barondes said in an interview. "We're not in a position to delay our benefits, and we're not sure many people are." The Social Security Administration's data suggests that the majority of workers are not in a position to delay their benefits. The agency's statistics show that the median age of new claimants is around 62, with many people filing for benefits as soon as they become eligible. This trend is not surprising, given the financial pressures many workers face in their 60s. "People are not saving enough for retirement, and they're not getting the kind of pensions they used to," said Alicia Munnell, a professor of economics at Boston College and a former director of the Social Security Administration's Office of the Actuary. "So, when they become eligible for Social Security, they're not in a position to delay their benefits." The conventional wisdom on Social Security is rooted in the program's design, which provides a 7-8 percent annual increase in benefits for each year a worker delays claiming them after reaching their full retirement age, which is either 66 or 67. Add the annual cost-of-living adjustment, and waiting until 70 to maximize benefits seems like a no-brainer. However, this advice assumes a level of financial security and planning that many workers do not have. In reality, many workers are forced to make difficult choices about when to claim their Social Security benefits. Some may need the money to cover living expenses, while others may be facing financial emergencies or caring for family members. "It's not just about the math; it's about people's lives," said Munnell. "We need to recognize that people are not all the same, and we need to provide more flexibility in the system." As the Social Security Administration continues to grapple with the challenges of an aging population and a shrinking workforce, it is clear that the program's design needs to be re-examined. While waiting until 70 to claim benefits may be the best financial move for some, it is not a realistic option for many others. By acknowledging this reality and providing more flexibility in the system, policymakers can help ensure that Social Security remains a vital source of support for workers in their golden years.