Should You Claim Early Social Security During an Economic Downturn?

Key takeaways

• Maximize your Social Security benefits by waiting to claim, personal finance expert Jean Chatzky advises.
• Each year you wait, annual benefits increase by about 8%, maxing out at age 70.
• Assess your financial situation to determine if waiting is a viable strategy for you.

Summary

Claiming Social Security benefits early may seem appealing, especially during economic downturns, but personal finance journalist Jean Chatzky advises caution. Delaying benefits from age 62 to 70 can result in an annual increase of around 8%, a return that’s hard to match. This decision has long-term implications, so it’s essential to assess whether you need the money immediately or can let your benefit grow. 

The key takeaways and summary were created with the assistance of generative AI. An AARP editor reviewed and refined the content for accuracy and clarity.

Full transcript

[0:00:04] The numbers of people filing for Social Security earlier have gone up because there

[0:00:11] is a lot of fear and uncertainty, but you need to be very careful before you do

[0:00:16] this. I would caution you to try to wait because for

[0:00:21] every year you wait to claim your benefits from age 62 to age 70,

[0:00:27] you typically get a bump.

[0:00:29] in those benefits of about 8% a year. That's a return that's difficult to beat in any

[0:00:34] other way. This is a decision that has ramifications that

[0:00:38] will last for a very, very long time.

[0:00:41] You should be asking yourself whether you actually need this money right now or

[0:00:48] whether you can allow your benefit to continue to grow.