How Can RIAs Help Clients Decide When to Claim Social Security?

Social Security claiming is one of the few retirement decisions that permanently changes a household’s inflation-adjusted income. For anyone born in 1960 or later, full retirement age is 67. Claiming at 62 reduces the benefit by about 30% for life, while waiting until 70 adds delayed retirement credits of 8% per year after full retirement age, or 24% above the full benefit.

The 2026 benefit amounts show how significant the difference can be: the maximum monthly benefit is $2,969 at age 62, $4,152 at full retirement age, and $5,181 at age 70. For RIAs, the decision should not come down to a rule such as “always wait” or “claim as soon as possible.” The right claiming age depends on longevity, household cash flow, spouse and survivor benefits, taxes, and how Social Security fits into the broader retirement plan.

Waiting to claim Social Security can function as a form of longevity insurance. A larger benefit becomes more valuable if the client lives long enough for the higher payments to make up for the years of smaller or missed payments.

Health, family history, and the household’s ability to fund spending before age 70 all matter. A client with poor health or limited portfolio assets may have stronger reasons to claim earlier. A client who can comfortably fund several years of spending from the portfolio may have more flexibility to delay.

COLAs also matter. Because the adjustment applies to the benefit already in payment, a larger starting benefit creates larger dollar increases when future COLAs are applied.

How Do Spousal and Survivor Benefits Affect the Claiming Decision?

Social Security claiming should be analyzed at the household level for married couples. A living spouse can receive up to 50% of the higher earner’s primary insurance amount at the spouse’s full retirement age. That spousal benefit does not increase because the higher earner delays claiming beyond full retirement age.

Survivor benefits work differently. A surviving spouse can receive up to 100% of the deceased worker’s actual benefit, including delayed retirement credits. If the higher earner delays until 70, the survivor benefit can therefore be substantially higher than it would have been if that person claimed earlier.

This makes the higher earner’s claiming age particularly important when the household is planning for the first death. Deemed filing also means that most people who claim before full retirement age generally file for their own retirement benefit and any spousal benefit at the same time.

How Should RIAs Account for Taxes and Medicare When Comparing Claiming Ages?

Social Security benefits can be taxable. Up to 85% of benefits may be included in taxable income once combined income exceeds $34,000 for single filers or $44,000 for married couples filing jointly. These thresholds have not been indexed for inflation, which means more retirees can become subject to taxation as other income rises.

The timing of Social Security should therefore be considered alongside wages, traditional IRA withdrawals, Roth conversions, and required minimum distributions. Roth withdrawals generally do not increase the combined-income calculation in the same way that traditional IRA withdrawals do.

Medicare costs should also be part of the analysis. Higher taxable income can increase Medicare Part B and Part D premiums through IRMAA, so the tax impact of claiming Social Security cannot always be separated from the rest of the household’s income plan.

What Other Areas Can Help RIAs Deliver More Client Value?

Retirement-income planning also depends on efficient portfolio and operational management.

Securities class action recovery is one overlooked area. Settlements totaled approximately $8 billion in 2025, creating a significant pool of potential recovery for investors.

Platforms such as 11th.com can automate the process of monitoring settlements, matching holdings, filing claims, and reconciling payouts. For RIAs, recovery alpha can help clients capture additional value from securities they already hold while reducing the manual work required to manage claims.

Social Security will increasingly be treated as one part of a broader household retirement-income strategy rather than as a standalone claiming decision.

For RIAs, that means comparing claiming ages alongside portfolio withdrawals, taxes, Medicare costs, spouse and survivor benefits, and longevity. The result should be a claiming strategy that fits the household’s financial resources and expected spending needs rather than a universal rule about when everyone should claim.

FAQ

What is full retirement age in 2026?

Full retirement age is 67 for people born in 1960 or later. People born earlier have a lower full retirement age based on their birth year.

Delayed retirement credits increase benefits by 8% for each full year after full retirement age, up to age 70.

Why does a spouse’s claiming age matter?

The higher earner’s claiming age can affect the surviving spouse’s future income because survivor benefits can be based on the worker’s actual benefit, including delayed retirement credits.

Yes. Depending on combined income, up to 85% of Social Security benefits can be included in taxable income.

It is the age at which the cumulative payments from a later, larger benefit overtake the total payments received from claiming earlier.