Does it pay to delay social security

  title={Does it pay to delay social security},
  author={John B. Shoven and Sita Nataraj Slavov},
  journal={Journal of Pension Economics \& Finance},
Social Security benefits may be commenced at any time between ages 62 and 70. As individuals who claim later can, on average, expect to receive benefits for a shorter period, an actuarial adjustment is made to the monthly benefit to reflect the age at which benefits are claimed. We investigate the actuarial fairness of that adjustment in light of recent improvements in mortality and historically low interest rates. We show that delaying is actuarially advantageous for a large number of people… 

Figures and Tables from this paper

Is the Adjustment of Social Security Benefits Actuarially Fair, and If So, for Whom?
Disparities in Social Security claiming ages have risen since the early 1990s. With high earners increasingly likely to delay claiming, and also living longer on average than lower earners, late
Have We Finally Achieved Actuarial Fairness of Social Security Retirement Benefits and Will it Last?
This paper develops a framework to analyze the actuarial adjustments faced by American workers who claim Social Security benefits before or after their Full Retirement Age (FRA). We derive the
The Consequences of Current Benefit Adjustments for Early and Delayed Claiming
Workers have the option of claiming Social Security retirement benefits at any age between 62 and 70, with later claiming resulting in higher monthly benefits. These higher monthly benefits reflect
Accounting for Social Security Claiming Behavior
Why do most individuals claim Social Security benefits before the full retirement age? Claiming benefits early results in a substantial reduction in pension income, yet many people claim as early as
The Consequences of Claiming Social Security Benefits at Age 62
Delaying claiming of Social Security old-age benefits past the earliest eligibility age, age 62, raises the monthly benefit for a person's life. Despite arguments from both proponents and opponents
The financial feasibility of delaying Social Security: evidence from administrative tax data
Abstract Despite the large and growing returns to deferring Social Security benefits, most individuals claim Social Security before the full retirement age. In this paper, we use a panel of
Early Social Security Claiming and Old-Age Poverty: Evidence from the Introduction of the Social Security Early Eligibility Age
Social Security faces a major financing shortfall. One policy option for addressing this shortfall would be to raise the earliest age at which individuals can claim their retirement benefits. A
Revisiting Retirement and Social Security Claiming Decisions
Why do individuals retire and claim their Social Security benefits at the age they do? Understanding the key drivers of these decisions has been an important topic of research as it can help guide


If individuals continue to withdraw completely fromthe labor force in their early 60s, a large and growingnumber will be hard pressed to maintain an adequatestandard of living throughout retirement.
The Effects of Subjective Survival on Retirement and Social Security Claiming
This research examines the relationship between mortality risk and retirement, and mortality risk and the propensity to take early and reduced Social Security benefits. The main theory for
How Much Do Households Really Lose by Claiming Social Security at Age 62
Individuals can claim Social Security at any age from 62 to 70 although most claim at 62 or soon thereafter. Those who delay claiming receive increases that are approximately actuarially fair. We
Social Security: When Should You Start Benefits and How to Minimize Longevity Risk?
T his study examines strategies for singles and couples who are deciding when to begin Social Security benefits. A client may decide to retire from work at age 65, but that does not mean he or she
Dying to Retire: Adverse Selection and Welfare in Social Security
Despite facing some of the same challenges as private insurance markets, little is known about the role of adverse selection in social insurance programs. This paper studies adverse selection in
Can the Actuarial Reduction for Social Security Early Retirement Still Be Right
The option to claim Social Security benefits earlier than the program’s Full Retirement Age, in exchange for receiving an actuarially reduced benefit, is a key feature of the nation’s Social Security
Framing Effects and Expected Social Security Claiming Behavior
Eligible participants in the U.S. Social Security system may claim benefits anytime from age 62-70, with benefit levels actuarially adjusted based on the claiming age. This paper shows that
Rethinking Social Security Claiming in a 401(k) World
This chapter argues that previous research on Social Security take-up alternatives has failed to recognize critical factors that greatly impact the discussion on when it is most beneficial to start
The distributional aspects of social security and social security reform
Social security is the largest and perhaps the most popular program run by the federal government. Given the projected increase in both individual life expectancy and sheer number of retirees,
Strange But True: Claim Social Security Now, Claim More Later
Under Social Security, married individuals are entitled to a retired worker benefit based on their own earnings and/or to a spousal benefit equal to one half of their spouse’s benefit claimed at the