Americans are claiming their Social Security checks early, even though delaying their claims could lead to higher payments.
Concerns over the long-term future of Social Security are pushing retirees to begin banking their checks as early as possible.
However, every year you delay taking a Social Security payment after full retirement age you receive a significant increase in payments up to the age of 70.
Benefits taken for the first time at age 70 would be 76 percent higher than if they were claimed at 62, according to Boston University economist Laurence Kotlikoff.
Therefore, someone who put off claiming until they were 70 instead of 62 would end up with more dollars in their pocket if they live to at least 80, he told The Wall Street Journal.
Despite this, pending Social Security claims for retirement, survivor and health insurance benefits totaled 580,887 last month, up from 500,527 a year earlier.
The drive to claim early appears to be largely driven out of fear that the system could collapse beforehand.
More than 75 percent of US adults are very worried about the fate of Social Security, according to a recent Gallup poll.
More Americans are claiming their Social Security checks early over fears for its future
Elon Musk and his so-called Department of Government Efficiency (DOGE) have cut 7,000 jobs from the Social Security Administration (SSA) in recent weeks.
The loss of more then 12 percent of the agency’s workforce has meant those reliant on benefits are facing unanswered calls or standing in line for hours at understaffed government buildings.
While Trump has said he does not plan to cut benefits, experts have warned that he and Musk are spreading misinformation about the program with a view to eventually dismantle it.
‘The spin that’s being used to justify going after the program, saying that there’s massive fraud, inefficiency and waste; I’ve never seen it and I’m a very close student of Social Security,’ Chris Orestis, founder and President of Retirement Genius, told DailyMail.com.
‘It is a well run and lean organization that quite frankly is understaffed for the important role that it plays.’
Musk has repeatedly alleged that the generosity of Social Security draws illegal immigration in to the US.
Musk and DOGE have claimed, without evidence, that the program has been the victim of mass fraud.
Officials at the SSA are aware of the effect the rhetoric is causing, stating that ‘fearmongering has driven people to claim benefits earlier,’ at a March 28 meeting.
Chris Orestis, founder and President of Retirement Genius, has more than 30 years’ experience
Elon Musk DOGE have cut 7,000 jobs from the Social Security Administration
Social Security relies on its trust funds to provide monthly benefit checks to around 70 million Americans
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‘That is leading people to make decisions based on fear,’ Kathleen Romig, director of Social Security at the Center on Budget and Policy Priorities, told The Wall Street Journal.
An aging population is pushing up the cost of the program as a smaller share of people are paying into it, and spending is outpacing income.
Financial advisers and retirement experts including Orestis usually advise maximizing your Social Security check, even if it means waiting a few extra years.
Orestis says one of the great virtues of Social Security payments is they are not tied to the stock market like a 401(K) or many Roth IRAs.
Therefore having a steady check each month can help offset the turbulence in financial markets.
Fears over Social Security’s future do predate Trump’s second presidency.
The trust which provides the funds to the program is expected to run short of cash by 2035 if no changes are made.
The latest annual report from the Social Security Board of Trustees found that the program will only be able to pay out full benefits for the next decade – which is one year later than previous estimates.