The Case for Claiming Social Security Early (Even If You Can Afford to Wait)

The standard advice on Social Security is to wait as long as possible, ideally until 70. Taylor Schulte, host of the Stay Wealthy Retirement Show, makes a credible case that for many people, that advice is wrong, or at least incomplete. His episode draws heavily on research by retirement economist Derek Tharp, and it is worth reading closely even if you are not close to a claiming decision yet.

The math depends on an assumption most people don't examine

The "delay to 70" case rests on discount rates of 0 to 2% above inflation, meaning a dollar of benefits at 95 is treated as roughly equal to a dollar today. Tharp's research points out that a retiree running a 60/40 stock-bond portfolio has historically earned closer to 5% above inflation. At that return assumption, the break-even math shifts and earlier claiming becomes more competitive. Schulte acknowledges that investing carries real risk and the 5% figure is a long-run historical average, not a guarantee. Still, it is the assumption buried in most "just wait" analyses, and it is worth surfacing.

Sequence-of-returns risk is concrete and underappreciated

If you delay Social Security, you draw down your portfolio earlier and harder to cover living expenses in the years before benefits kick in. If markets fall 20 or 30% in years one through three of retirement while you are pulling money out, those losses compound permanently in a way that academic breakeven tables tend to ignore. Schulte's point: the decision to delay is not just an actuarial calculation. It is also a bet that your portfolio holds up during exactly the years you can least afford it not to.

Mortality and healthspan

Schulte, drawing on Bill Perkins's Die With Zero, flags something that actuarial tables miss. Average life expectancy does not protect you from being one of the people who dies before the delayed benefit ever pays off. More practically, money at 62 can fund things that are simply harder or impossible at 85. That is not an argument for recklessness. It is an argument for factoring actual health and actual plans into the decision, not just the breakeven age.

Flexibility versus guaranteed income

Social Security payments are fixed except for cost-of-living adjustments. A larger portfolio stays flexible: accessible for emergencies, family needs, or a one-time opportunity. Draining savings to delay benefits can leave someone with more guaranteed monthly income and no financial room to maneuver. For people without substantial assets, that trade-off may not be worth making.

The spending-psychology finding

A 2025 Retirement Income Institute study cited by Tharp found retirees spend roughly 80% of guaranteed income (Social Security, pensions) but only about 50% of portfolio withdrawals. If you know you will be reluctant to draw down a brokerage account but will spend a Social Security check, that behavioral reality belongs in the claiming decision alongside the actuarial math.

Policy risk

A 2025 AARP study found only 36% of Americans feel confident about Social Security's future. The Social Security trust fund is projected to run short by 2033, which under current law would trigger a benefit reduction (the Trustees have projected payable benefits at roughly 75 to 80% of scheduled amounts), not an elimination. For someone retiring at 62 today, that is about 11 years out. It is a real factor, not a reason to panic, and it belongs on the list of things your adviser should be running numbers on.

One thing to keep in mind about the source

Schulte runs a retirement planning firm, Define Financial, and closes the episode with a pitch for a free strategy session. The six reasons he covers are all legitimate planning considerations. They also collectively tilt toward earlier claiming, which tends to generate earlier planning conversations with advisers. The arguments stand on their own; just know where the presenter sits.

Taylor Schulte, host of the Stay Wealthy Retirement Show, walks through six research-backed reasons why claiming Social Security before age 70 can make sense even for people who could afford to wait. The episode leans heavily on recent work by retirement researcher Derek Tharp and is a useful counterweight to the reflexive "always delay" advice — but it stops short of telling anyone what to do.

What was covered

• The standard case for delaying — Schulte opens by summarizing why waiting is usually recommended: a 62-year-old who waits until 70 can see a 77% increase in monthly benefits (using illustrative figures of $2,100 at 62, $3,000 at full retirement age of 67, $3,720 at 70), plus inflation protection and longevity coverage.
• The discount-rate problem — Derek Tharp's research argues that studies favoring delay typically use discount rates of 0–2% after inflation, implying a dollar of benefits at 95 is worth the same as a dollar today. Schulte argues that a retiree with a 60/40 stock-bond portfolio has historically earned closer to 5% above inflation, which changes the math significantly in favor of earlier claiming.
• Sequence-of-returns risk — Delaying Social Security forces larger early portfolio withdrawals to cover living expenses. If markets drop in those first years, those extra withdrawals can permanently damage a nest egg in ways that standard academic models ignore.
• Mortality risk and "healthspan" — Claiming early protects against dying before the higher delayed benefit pays off. Schulte draws on Bill Perkins's book Die With Zero to argue that money received at 62 can fund experiences that simply aren't available at 85 or 90.
• Flexibility vs. security — Social Security payments are fixed (aside from cost-of-living adjustments). Keeping more money in an investment portfolio preserves the ability to take lump sums for emergencies, family needs, or once-in-a-lifetime opportunities. Spending down savings to delay benefits can leave a retiree with more guaranteed income but no financial freedom.
• Policy risk and spending psychology — A 2025 AARP study found only 36% of Americans feel confident about Social Security's future, with the trust fund projected to run short by 2033. Separately, a 2025 Retirement Income Institute study cited by Tharp found retirees spend about 80% of guaranteed income (Social Security, pensions) but only about 50% of portfolio income — suggesting that claiming earlier may actually help people enjoy their money while they're healthy.

Notable claims & predictions

• Taylor Schulte, citing Derek Tharp: "If you assume that you can earn 5% above inflation on your investments rather than 0 to 2%, delaying Social Security becomes much less financially attractive." The implication: the "always wait" math depends heavily on an assumption most retirees don't actually live by.
• Taylor Schulte: "90% of Americans claim before age 70." He uses this to argue that early claiming is not simply irrational — there are legitimate reasons even for people with adequate savings.
• Taylor Schulte, citing Derek Tharp and Nassim Taleb: Focusing on average life expectancy when making the claiming decision is like crossing a river that is "on average 4 feet deep" — ignoring the 10-foot spots. The average doesn't protect you from dying before your delayed benefit ever pays off.
• Taylor Schulte, citing 2025 Retirement Income Institute study: Retirees spend roughly 80% of guaranteed income but only about 50% of portfolio withdrawals. Claiming Social Security earlier may unlock more actual spending and enjoyment during healthiest years.
• Taylor Schulte, citing 2025 AARP study: Only 36% of Americans feel confident about Social Security's future. Schulte and Tharp argue policy risk is real and should be factored into the discount rate — not assumed away at 0%.
• Taylor Schulte: For retirees with modest savings who drain accounts to delay benefits, the result can be "more guaranteed income for the rest of your life, but no financial freedom" — a trade-off that may not be worth it for people who are not wealthy.

Fact check

"90% of Americans claim before age 70." This figure is consistent with SSA data that has shown the large majority of beneficiaries claim well before 70, though the precise percentage varies by year and definition. The broad claim is plausible and widely reported, but Schulte does not cite a specific source. Treat it as a reasonable approximation rather than a precise current figure.

"The Social Security trust fund is projected to run short by 2033." The 2033 (or nearby) depletion date has appeared in recent Social Security Trustees Reports and is widely cited. Schulte correctly notes this would not eliminate benefits but would likely reduce them — the Trustees have projected payable benefits at around 75–80% of scheduled amounts if Congress takes no action. The claim is accurate in substance.

"A properly constructed global 60/40 portfolio has historically earned closer to 5% above inflation." This is a long-run historical approximation, not a guarantee. Five percent real is toward the optimistic end of what financial planners typically project for a 60/40 portfolio going forward; many current estimates are lower. Schulte acknowledges investing is risky and the eight-year window is short. The figure is a reasonable historical reference, but applying it as a planning assumption carries real uncertainty — and Schulte has a financial planning practice that benefits from clients believing their portfolios will outperform a delayed Social Security benefit.

Spending ratios from the 2025 Retirement Income Institute study (80% of guaranteed income spent vs. 50% of portfolio income). Schulte cites this accurately as coming from Tharp's paper. The finding is plausible and consistent with behavioral finance research on "mental accounting," but the 2025 study is recent and the numbers could not be independently verified here. File it as an interesting and directionally credible finding, not a settled fact.

Misaligned incentive to flag: Schulte runs a retirement planning firm (Define Financial) and closes the episode with a pitch for a free strategy session. The six reasons he presents are all legitimate academic and planning considerations, but they collectively tilt toward encouraging earlier claiming — which also tends to encourage earlier retirement planning conversations with advisers. That does not make the arguments wrong, but it is worth noting that the episode's framing conveniently aligns with the interests of a fee-based planning practice.

Why this matters for you

• If you are within a few years of 62, 67, or 70, this episode is a direct prompt to revisit your claiming strategy with a financial planner who will run numbers for your specific health, savings mix, and tax situation — not just tell you to wait because "the textbooks say so."
• Sequence risk is concrete and underappreciated. If you plan to delay Social Security, it is worth explicitly modeling what happens to your portfolio if markets drop 30% in years one through three of retirement while you are drawing it down to cover expenses. This episode gives you the vocabulary to have that conversation.
• The spending-psychology finding is actionable. If you know you are likely to be reluctant to draw down a portfolio but would spend Social Security checks more freely, that behavioral reality belongs in your claiming decision — not just the actuarial math.
• Policy risk warrants a look but not panic. The 2033 trust fund projection is real; a benefit cut (not elimination) is the most likely outcome absent congressional action. For someone retiring at 62 today, that is roughly 11 years away. It is a factor worth discussing with an adviser, but it should not override a well-considered strategy.