For years, financial experts have repeated a familiar piece of retirement advice: delay claiming Social Security for as long as possible to maximize monthly benefits.
While that strategy can make sense for many retirees, it is not always the best choice—especially for individuals who have accumulated substantial retirement savings.
In fact, some retirement planners argue that a 65-year-old with a $2 million nest egg may be better off claiming Social Security at age 62 rather than waiting until age 70. The reasoning has less to do with maximizing monthly checks and more to do with preserving wealth, reducing risk, and creating greater financial flexibility.
The Traditional Argument for Waiting Until 70
Under current Social Security rules, beneficiaries who delay claiming beyond their full retirement age earn delayed retirement credits.
For many workers:
- Claiming at 62 can reduce benefits by roughly 30%.
- Waiting until full retirement age results in a standard benefit.
- Delaying until age 70 can increase monthly payments by approximately 24% to 32%, depending on birth year.
This guaranteed increase is one reason many financial advisors recommend delaying benefits.
Higher monthly checks can provide valuable protection against longevity risk and inflation throughout retirement.
Why Wealthier Retirees May Think Differently
For retirees with $2 million or more invested, the equation often changes.
Instead of relying heavily on Social Security for essential living expenses, these individuals may already have substantial assets capable of generating retirement income.
As a result, the goal may shift from maximizing Social Security income to optimizing overall wealth.
Reason #1: Claiming Early May Preserve Investment Growth
One argument for claiming at 62 is that it allows retirees to spend Social Security benefits while leaving more investment assets untouched.
For example:
- A retiree who delays benefits until age 70 may need to withdraw additional money from investment accounts during those years.
- Claiming earlier can reduce portfolio withdrawals.
- Lower withdrawals may allow investments more time to grow.
If markets perform well over time, the additional investment growth could outweigh the benefit of larger future Social Security checks.
Reason #2: The Break-Even Age May Be Later Than Expected
Many claiming decisions come down to the break-even point.
While every situation differs, retirees who delay benefits often need to live into their early 80s or beyond before the larger monthly checks fully compensate for the years of missed payments.
For some retirees:
- Health concerns
- Family longevity history
- Personal lifestyle goals
may make earlier benefits more attractive.
If someone does not expect to live well beyond the break-even age, delaying may not provide the greatest lifetime value.
Reason #3: More Flexibility During Active Retirement Years
Many retirees spend more money during the early years of retirement.
Travel, hobbies, family activities, and major purchases often occur during the first decade after leaving the workforce.
Claiming benefits earlier may provide additional cash flow precisely when retirees are most active and able to enjoy it.
Some financial planners refer to this period as the “go-go years” of retirement.
Reason #4: Future Policy Uncertainty
Although Social Security remains one of the nation’s most stable programs, some retirees worry about future reforms.
Current projections indicate that the retirement trust fund could face financial pressure in the early 2030s if Congress does not enact changes.
While experts generally expect lawmakers to address the issue before major disruptions occur, some retirees prefer collecting benefits sooner rather than later rather than relying on future policy outcomes.
Reason #5: A $2 Million Portfolio Already Provides Significant Income
Using a common 4% withdrawal guideline:
- A $2 million portfolio could potentially generate about $80,000 annually.
- Combined with Social Security benefits, many retirees would have substantial income even after claiming early.
Because their retirement security does not depend entirely on maximizing Social Security payments, wealthier retirees often have more flexibility in choosing when to claim.
When Waiting Until 70 Still Makes Sense
Despite these arguments, delaying benefits remains a strong strategy for many households.
Waiting may be advantageous if:
- You expect to live well into your 90s.
- You have limited retirement savings.
- You want the largest possible guaranteed lifetime income stream.
- You are protecting a surviving spouse who may later receive survivor benefits.
For married couples, spousal and survivor considerations often play a major role in claiming decisions.
The Bottom Line
A retiree with $2 million in savings may not need to follow the traditional advice of waiting until age 70 to claim Social Security.
For some affluent retirees, claiming at 62 can provide greater flexibility, reduce portfolio withdrawals, and potentially allow investments to continue compounding. However, the best claiming age depends on personal health, life expectancy, tax considerations, marital status, and retirement goals.
Ultimately, there is no universal answer. What matters most is building a Social Security strategy that fits your overall retirement plan rather than focusing solely on maximizing the monthly benefit amount.
