You’ve probably heard the advice: you should always wait until age 70 to collect Social Security because that’s how you get the most money. It’s a message that gets repeated so often that it starts to feel like a universal truth. But the reality is far more nuanced. For many people, waiting until 70 can actually work against them.
As a financial adviser, I’ve walked through this math with hundreds of clients. I’ve seen situations where delaying makes perfect sense—and situations where it creates unnecessary pressure on the rest of someone’s financial plan. Before committing to delaying your benefit, it’s important to understand the trade-offs and how they interact with your investments, taxes, and lifestyle strategies.
Why Waiting Until 70 Looks So Attractive on Paper
The logic is straightforward. Once you reach your full retirement age, every year you delay up to age 70 earns you delayed retirement credits. Those credits increase your benefit by roughly 8% per year, calculated monthly. That higher payment at age 70 is the largest Social Security check you can receive.
There’s no disputing that. But retirement isn’t lived on spreadsheets. It’s lived in reality, where drawing from your portfolio, managing taxes, and planning for both longevity and lifestyle all matter just as much as the size of your monthly check.
The Trade-Off Most People Miss
To understand when delaying can backfire, start with a simple scenario. Let’s say you retire at 62 but don’t want to collect Social Security until 70 because you want that higher benefit. You still need income for those eight years. For most people, that income comes from their portfolio.
That creates a meaningful opportunity cost. Just like taking Social Security early reduces the amount you receive later, pulling from your portfolio early reduces what that portfolio could otherwise grow to. Every year you’re drawing down investments is a year those investments aren’t compounding for your future.
This isn’t an issue if you keep working until 70. But if you retire before that and rely heavily on withdrawals, you’re increasing your Social Security benefit while simultaneously decreasing the potential future income your portfolio can generate. The real goal isn’t maximizing Social Security alone; it’s maximizing the combined lifetime value of Social Security and your portfolio.
There’s also the reality that no one is guaranteed a certain number of years. Health, longevity, and family history all play a part. Maximizing a monthly benefit doesn’t necessarily mean maximizing lifetime income—especially if you’re not confident you’ll have a long life expectancy.
Case Study: When Delaying Worked
Greg was 66 and Michelle was 64. They had plenty of savings, including cash and a sizable brokerage account. Their spending was moderate, and they had significant balances in pre-tax IRAs. They were also in great health with strong family longevity.
For them, delaying until 70 worked exceptionally well. They were able to live on their cash and brokerage assets for the first several years, which kept their taxable income very low. Instead of just enjoying those low-income years, we used them intentionally to begin shifting money from their pre-tax IRAs into Roth IRAs.
Those Roth conversions allowed them to move a large portion of their pre-tax savings into accounts that would never be taxed again. Without doing that, once both Social Security benefits started at 70, their required minimum distributions would have combined with those benefits and pushed them into very high tax brackets.
Delaying Social Security didn’t just maximize their benefit; it created room to reduce future taxes and position more of their assets for tax-free growth.
Case Study: When Delaying Didn’t Work
Linda was 63, in moderate health, with moderate family life expectancy. She decided to wait until 70 simply because she had heard it was best.
What she didn’t anticipate was the impact on her portfolio. To bridge the gap from 63 to 70, she had to withdraw more than expected. By the time she reached age 70, she did have a higher Social Security benefit, but her savings had been diminished significantly. Her Social Security covered a good amount of her needs, but she didn’t feel secure. She worried about major health events or other unexpected expenses. The problem wasn’t her Social Security—it was the cost of getting there.
Had she collected sooner, even if not at 63, she likely could have avoided drawing down her portfolio so heavily and would have felt far more confident about her long-term flexibility.
When Waiting Until 70 Might Not Make Sense
Delaying can be powerful, but there are several situations where it can work against you. Based on the transcript, here are the exact scenarios discussed:
- Poor health or limited family longevity. If you don’t expect a long life expectancy, delaying may increase your monthly benefit but decrease the total income you receive over your lifetime.
- You must draw heavily from your portfolio before 70. Maximizing Social Security while simultaneously diminishing your investments may reduce the overall income your portfolio can provide later.
- You face a major bear market while withdrawing. If markets drop 30–40% while you’re drawing to wait until 70, you might reduce your portfolio too quickly to recover.
- You want more flexibility in early retirement. Spending is often higher in the early years. Collecting sooner can increase flexibility—though it’s important to balance this with long-term needs.
Pulling It All Together
Delaying Social Security until 70 is not a one-size-fits-all strategy. It can be incredibly effective, but only when it fits the rest of your financial picture, including income needs, tax planning opportunities, investment strategy, and personal longevity expectations.
The key is to look beyond the single number of your age-70 benefit and instead evaluate your entire situation. Run the numbers both ways. Ask how each choice affects your investments, your taxes, and your flexibility. And then make the decision that’s best aligned with your goals and circumstances.
This isn’t about following a blanket rule—it’s about understanding how one decision influences every part of your financial plan and choosing the approach that supports your life both today and in the future.
Ready to find out which Social Security strategy fits your situation? Schedule a call with our team to see whether working together might be a good fit.
The information presented is for educational and informational purposes only and should not be construed as personalized investment or financial advice. The content discusses general retirement planning strategies and is not intended to recommend any specific course of action for any individual.
Social Security claiming strategies involve a number of variables, including life expectancy, portfolio returns, tax considerations, and personal circumstances. Decisions regarding Social Security benefits should be made in consultation with your financial advisor, taking into account your full financial picture.
Examples provided are hypothetical and for illustrative purposes only. They do not reflect any specific client situation and should not be relied upon for investment decision-making. Past performance of investments is not indicative of future results. All investing involves risk, including the potential loss of principal.
Root Financial Partners, LLC provides tax planning as part of its financial planning services. However, we do not provide tax preparation services, represent clients before the IRS, or offer legal advice.
Clients should consult their CPA or attorney before implementing any tax or legal strategies discussed. Nothing in this video should be interpreted as a recommendation to take a specific tax position or legal action.
This content may include discussions around advanced financial planning strategies such as Roth conversions, backdoor Roth IRAs, tax loss harvesting, charitable giving, estate planning tactics, or Social Security claiming strategies. These concepts are general in nature and are not personalized advice. Actions related to these strategies may trigger tax consequences or legal implications. Always consult with your CPA or attorney to assess suitability based on your personal financial circumstances.
Suitability for these strategies depends on your individual tax situation, income, age, investment profile, estate plan, and other factors. Actions related to these strategies may trigger tax consequences or legal implications. Always consult with your CPA or attorney to assess suitability based on your personal financial circumstances.