1. Home
  2. Grow
  3. 5 Unique Features of Social Security Income — and Why You Should Delay It
  • Sign up
  • Sign in
Money Talks News
  • Popular
  • Latest
    • Coronavirus
    • Ask Stacy
    • Make
    • Save
    • Borrow
    • Grow
    • Live
    • More
  • Deals
    • Automotive
    • Clothing & Accessories
    • Computers
    • Electronics
    • Everything Else
    • Financial Services
    • Gaming & Toys
    • Health & Beauty
    • Home & Garden
    • Movies, Music & Books
    • Office & Supplies
    • Special Occasion
    • Sports & Fitness
    • Store Events
    • Travel & Entertainment
  • Podcasts
  • Solutions
  • Academy
  • Subscribe to our newsletter
  • Follow us on Facebook
  • Follow us on Twitter
  • Search our site
5 Things You Must Do Before the Next Recession5 Things You Must Do Before the Next Recession
4 Genius Ways to Protect Your Retirement Savings4 Genius Ways to Protect Your Retirement Savings
Senior man leaning on a caneOlder Adults Who Can’t Do This May Be at Higher Risk of Death
Woman looking at box of old things to donate or sell17 Things You’re Keeping for No Reason — and Should Toss

5 Unique Features of Social Security Income — and Why You Should Delay It

Social Security benefits are immune to more types of risk than other sources of retirement income. So, it's critical that you maximize the size of your checks.

Karla Bowsher • January 8, 2018 • Advertising Disclosure

Share on Facebook Share on Twitter Share by Email Share on Pinterest Printable version available to members PDF version available to members
Social Security cards
zimmytws / Shutterstock.com

Social Security payments offer a combination of advantages no other income source can offer retirees, a recent report from the Stanford Center on Longevity points out.

This means it’s even more important for retirees to think through their strategy for claiming Social Security benefits.

The report found that for “virtually all” workers and retirees with less than $1 million in savings, Social Security will comprise at least 50 percent and as much as 85 percent — if not more — of their retirement income.

The exact percentage of retirement income that Social Security generates for such retirees boils down to whether “they optimize the value of their Social Security benefits through their claiming strategy,” as the report puts it.

The advantages of Social Security

Retirement income faces risks. Many workers and retirees worry about outliving their retirement savings, for example. Other risks include the shrinking of savings due to inflation or taxes.

Social Security is largely immune to most such risks, however. The Stanford Center on Longevity points out that the pros of Social Security as a source of retirement income include that it’s:

  1. A lifelong payment, helping address longevity risk.
  2. Subject to regular increases, helping address inflation risk.
  3. Partly or fully exempt from federal income tax, helping address taxation risk.
  4. Not subject to financial-market risk, helping address investment risk.
  5. Paid automatically, helping address the risks of fraud and cognitive decline

The center continues:

“No other method of generating retirement income includes all these desirable features, so Social Security benefits represent a unique, valuable resource. This is one reason it’s important for middle-income retirees to optimize the value of their Social Security benefits.”

Perhaps the only type of risk that Social Security income might face is political risk. In other words, there’s a risk that benefits could be reduced after Social Security trust funds’ reserves are depleted, unless Congress addresses funding issues before that happens.

That’s not projected to happen for about 18 years, however, according to the latest annual report on Social Security and Medicare trust funds. The particular trust fund that pays retirement and survivors benefits, called the Old-Age and Survivors Insurance (OASI) Trust Fund, is currently flush enough to pay those benefits in full until 2035.

The importance of Social Security claiming strategies

Perhaps the best way to maximize the amount of your Social Security payments is to delay claiming benefits.

You can claim your Social Security benefits as early as age 62. But for every year that you put this off, until as late as age 70, you increase the amount of your benefit payments. We detail this in:

  • “14 Ways to Maximize Your Social Security Checks“
  • “Ask Stacy: Do I Really Need to Wait Until Age 70 to Collect Social Security?“

The Stanford Center on Longevity report even suggests that some retirees use their own savings to help them delay claiming Social Security benefits, likening this claiming strategy to buying an annuity:

“Risk-averse retirees who would otherwise consider purchasing low-performing annuities and fixed-income investments should consider first using their savings to enable delaying the start of Social Security benefits. The increase in Social Security benefits that is achieved by delaying benefits can be viewed as ‘purchasing an annuity from Social Security’ at a very favorable rate.”

To learn about how you can obtain a personalized report on Social Security claiming strategies, visit the “Maximize Your Social Security” section of the Money Talks News Solutions Center.

How do you feel about delaying Social Security? Sound off below or on our Facebook page.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

  Like Article   Add a Comment

Sign up for our free newsletter!

Simple ways to make, save, and grow your money daily:

  happy subscribers    

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

MTN Podcasts

Every week our podcasts bring you lively money discussions that will give you a few laughs along with advice that will make you richer.

Money with Stacy Johnson

Listen/Subscribe

Read Next

Some of our favorite stories for you to read next.

Sad senior woman drinking coffee
This Type of Social Security Benefit Is Often Overlooked
A confused older man wonders about Social Security
7 Social Security Rules Everyone Should Know by Now
Senior using a smartphone
12 Ways Retirees Can Earn Passive Income
Sign up for our free newsletter!

Join our many free newsletter subscribers building wealth and destroying debt:

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Popular Topics
  • Retirement Investment
  • Surveys for Money
  • How to Make Money Online
  • Emergency Stockpile
  • Free Movie Streaming
  • Senior Discounts
Connect
  • Support & FAQs
  • Memberships
  • About
  • Contact
  • Careers
  • Accessibility Statement
Media
  • Advertise
  • Television
  • Where We Air
  • Scripts
  • Sitemap
Legal
  • Terms
  • Privacy
  • Cookies
Editorial
  • Fact-Checking Policy
  • Ethics Policy
  • Corrections Policy
  • Ownership & Funding Info

Do Not Sell My Personal Information

© 2022 Money Talks News. All Rights Reserved.
‭1 (833) 669-8557 | 1732 1st Ave #26661, New York, NY 10128

Advertising Disclosure: This site may be compensated in exchange for featured placement of certain sponsored products and services, or your clicking on links posted on this website.

View This Page Without Ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Help us produce more money-saving articles and videos by subscribing to a membership.

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.

Sign up for our free newsletter!

Join our happy subscribers and sign up for our free newsletter! You'll get:

  • Tips and advice from our expert money reporters. (Our average experience is 18 years!)
  • Unexpected ways to make more and spend less, delivered to you daily.
  • The best deals and coupons to save on everything you buy.
  • Free copies of our eBooks '208 Ways to Save Money Every Day' and '108 Easy Ways to Earn Extra Cash', together a $29 value!

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.