Deferred Claiming of Social Security Becoming a Preferred Strategy

It may be attributable to one of several factors, but there is an emerging trend in the timing of Social Security benefit applications. From 2004 to 2016, for example, the percentage of men applying for benefits at age 62 plummeted from half to less than a third, while women showed a similar drop, from 55% to 37%, according to a post by Reuters columnist Mark Miller today on The number of claimants waiting to their full retirement age (FRA) has also climbed, as has the number of folks waiting beyond FRA to take advantage of delayed retirement credits (DRCs)…but this remains a small percentage of the total claimants.

So, what’s the reason? As Miller points out in his post, one of the likely contributing factors is increased public awareness of the math (a.k.a. higher monthly benefits) behind deferring claims, but it can also be attributed to changes in the manner in which retirement finances are planned. The continual disappearance of private pension plans and the resulting shift to personal responsibility for ensuring cash availability in retirement, for example, are making it more and more important for individuals to be accountable for their financial security.

And although Miller doesn’t include it in his post, the growing number of workers staying in the labor market beyond their original planned retirement date could likely be another factor. The taxation of Social Security income tends to erode the value of  benefits if one remains in the workforce and exceeds the “earnings test” imposed on wages.

All of these factors taken together put a spotlight on the gradual shift in retirement planning taking place in America, and Miller’s post covers some of the major aspects of this shift. Check it out here…


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