Claiming Social Security Before Age 70? Here's What It Could Cost You—According to New Research

The timing of your Social Security claim represents one of the most consequential financial decisions in retirement. Yet most Americans are getting it wrong, according to a landmark study from the National Bureau of Economic Research (NBER). In the US, workers can begin collecting as early as 62, but the majority who do end up sacrificing substantial lifetime income.

The Real Price Tag of Early Claims: $182,000 in Potential Losses

A 2022 NBER analysis examined claiming patterns across American households and ran the numbers through optimization modeling. The findings were striking: for households headed by workers currently aged 45 to 62, claiming Social Security before the optimal age could result in a median lifetime spending power loss exceeding $182,000 (in 2022 dollars).

The research compared actual claiming behavior against mathematically optimized strategies. The gap between what people do and what they should do is substantial. Nearly 25% of new retirees begin collecting at 62—the absolute earliest possible age—while close to half claim before reaching their full retirement age (FRA).

Why the Age Matters: Benefits Grow Significantly Between 62 and 70

The mathematics of Social Security are straightforward but often misunderstood. Benefits claimed at 62 represent the smallest possible payout based on your earning history. Each year you delay increases your payment amount permanently.

By age 70, your benefit reaches its maximum. The NBER research suggests that in the US, over 90% of workers aged 45 to 62 would actually maximize their total lifetime benefits by waiting until age 70—not 62, not 65, but 70.

This isn’t just about receiving more per month. It’s about total lifetime wealth accumulation. The statistical analysis assumes a typical lifespan, and under those assumptions, the advantages of delayed claiming are dramatic.

What This Means for Your Retirement Strategy

The research indicates that most workers should delay Social Security beyond age 65 if their goal is maximizing lifetime income. Yet the actual claiming behavior tells a different story: many can’t afford to wait, or they lack awareness of the financial consequences.

The decision, however, remains personal. Someone with below-average life expectancy might reasonably choose the smaller monthly payment earlier. Others facing immediate cash needs might prioritize liquidity over long-term optimization. Financial advisors emphasize that claiming age should align with individual circumstances—health status, longevity prospects, current expenses, and retirement goals all factor into the decision.

The Bottom Line

For most Americans in the US working population, the research offers a clear guideline: if maximizing lifetime spending power is the objective, delay claiming Social Security past 65, and strongly consider waiting until 70. The alternative—claiming early—could cost you over $180,000 across your remaining years in today’s dollars.