The Social Security claiming age you choose permanently sets your monthly benefit, and a National Bureau of Economic Research working paper says most Americans are getting that choice wrong. The median household leaves roughly $182,000 in lifetime benefits uncollected by claiming too early, according to NBER Working Paper w30675.
How Your Claiming Age Moves the Number
For anyone born in 1960 or later, full retirement age is 67. That is when you receive your primary insurance amount (PIA), which the Social Security Administration calculates for an individual first eligible in 2026 as: 90% of the first $1,286 in average indexed monthly earnings, plus 32% of earnings between $1,286 and $7,749, plus 15% of anything above $7,749.
Claim before 67 and that PIA is cut permanently. At 66 the reduction is 6.7%. At 65 it is 13.3%. At 64, 20%. At 63, 25%. At 62, the earliest possible age, the reduction reaches 30%.
Delay past 67 and the math runs the other way. Benefits grow at 8% per year, adding up to a 24% boost by age 70. After 70 the credits stop, making 70 the effective ceiling.
The Financial Planning Association‘s journal cites economist Laurence Kotlikoff noting that Social Security accounts grow at 7% per year from 62 to 66, then at 8% to 70, a rate that often beats what bonds inside an IRA would return over the same period.
What the Research Says About Social Security Claiming Age
The NBER paper modeled claiming behavior for Survey of Consumer Finances respondents aged 45 to 62. The weighted average actual claiming age in that group is 65.0. The optimized age, the one that maximizes expected lifetime benefits, is 69.4.
The distribution gap is wide. Under actual behavior, 30.1% claim at 62 and only 10.2% claim at 70. Under the optimized scenario, 0% claim at 62 and 91.6% claim at 70.
The break-even calculation explains why. A person deciding between 62 and 70 reaches the crossover point at age 80.3: before that birthday, the early claimer has collected more total dollars; after it, the late claimer pulls ahead. For anyone weighing 67 versus 70, the break-even is 82.5. Because most people outlive both thresholds, the NBER paper concludes that 70 is the better choice for most households.
When Waiting Until 70 Is the Wrong Call
The research treats 70 as the default optimum, but individual circumstances override general findings. People who need Social Security income to cover basic living costs in their early 60s cannot simply defer. Those with serious health conditions may not expect to reach their break-even age, making an earlier claim rational.
There is also a rule that catches many households off guard. Spousal benefits do not earn delayed retirement credits past the claimant’s own full retirement age, according to a review of claiming rules by Wenzel Bennett & Harris. The SSA’s early retirement calculator confirms that a spouse collecting on a partner’s work record receives 50% of that partner’s PIA at full retirement age, subject to reduction for early claiming. Waiting past that full retirement age produces no additional spousal benefit.
For workers with a 401(k), IRA, pension, or investment portfolio large enough to cover expenses, deferring to 70 is the dominant strategy. The NBER paper found only around 1 in 10 people actually do so.
The gap between what people do and what the math recommends is large enough that even a partial shift, from 65 to 68, would meaningfully change lifetime benefit totals for most households. The break-even ages are the number to know: if your health and finances suggest you will likely clear 80, the case for waiting gets harder to argue against.
