The age you claim Social Security can cost—or make—you six figures. Social Security isn’t just a safety net, it’s a lifeline. The program is one of the few sources of guaranteed, inflation-adjusted income you can count on for life. And yet, most Americans don’t treat it like a strategic asset. Nearly 60% of people claim their benefits before reaching full retirement age (FRA), even though waiting can significantly increase monthly payouts.

The reality is, your claiming age can impact more than just the amount on your check. For high earners and financially comfortable households, poor timing could trigger avoidable tax burdens, raise Medicare premiums, and reduce total lifetime income by six figures. 

Any decision should be tightly coordinated with your broader financial picture—including taxes, retirement savings withdrawals, RMDs, and your spouse’s plan. This is especially true with changes introduced by the SECURE 2.0 Act and the “One, Big, Beautiful Bill.”

If you’re wondering whether to claim now or wait, here’s what to weigh.

Table of Contents 

  1. The basics: How Social Security timing affects your monthly check
  2. Social Security isn’t taxed the same for everyone
  3. Delaying benefits can boost monthly income and shrink long-term tax exposure
  4. Early benefits can work—but come with trade-offs
  5. Keep working? You might delay benefits—or owe a clawback
  6. Retirement tax planning means thinking beyond Social Security
  7. When you delay, everyone benefits—including your spouse
  8. A smart drawdown strategy supports long-term stability
  9. Get started with Harness

The basics: How Social Security timing affects your monthly check

The longer you wait to claim Social Security (up to age 70), the higher your monthly benefit. Claiming early can permanently reduce your benefit by up to 30%, while delaying until age 70 can boost it by as much as 77%.

Here’s an example straight from the Social Security Administration: A person whose full retirement age benefit is $2,000 per month would only receive $1,400 if they claimed at 62. But if they wait until 70, their benefit rises to $2,480 for a difference of $1,080 per month for life. That’s more resilience against inflation, longevity risk, and the high cost of late-life healthcare.

Waiting can also increase benefits for your spouse or survivor. If you’re the higher earner, delaying may secure larger benefits for your partner after you’re gone.

Social Security isn’t taxed the same for everyone

Retired woman sitting on a bench outdoors with her daughter while they both look at the older woman’s iPhone.

Most retirees are surprised to learn that up to 85% of their Social Security benefits may be taxable—depending on their total income. If Social Security is your only income, you likely won’t owe federal taxes on those benefits. But once you add IRA withdrawals, 401(k) distributions, rental income, or freelance work or a part-time job to the mix, taxes on your benefits can kick in.

The IRS uses something called “combined income” to determine how much of your benefit is taxable. It includes your adjusted gross income (AGI), nontaxable interest, and half of your Social Security benefits. If you file as an individual and your combined income exceeds $25,000 (or $32,000 if married filing jointly) you could owe tax on up to 85% of your SS benefits.

That tax exposure makes it essential to plan withdrawals from taxable retirement accounts carefully. A bad drawdown sequence could trigger unnecessary taxes. Pair that with Required Minimum Distributions (RMDs) once you hit age 73, and the case for expert retirement tax planning becomes obvious.

Delaying benefits can boost monthly income and shrink long-term tax exposure

The longer you wait (up to age 70), the more you receive in monthly Social Security income. For each year you delay past full retirement age (usually 66–67), your benefits increase by about 8% due to delayed retirement credits. That can mean hundreds more per month—or thousands per year—for the rest of your life.

But there’s also a tax benefit: the more of your income you can source from Social Security (which is only partially taxed), the less you may need to withdraw from fully taxable retirement accounts. In that way, waiting can shift your income mix in a tax-efficient direction.

Delaying benefits also strengthens survivor benefits. If you’re the higher earner in a married couple, holding off until 70 ensures your spouse receives a higher monthly amount if you pass away first. For couples, that can create a crucial income floor that protects against outliving savings in later years.

Early benefits can work—but come with trade-offs

You can claim Social Security as early as age 62, but doing so means accepting a reduced monthly benefit—for life. For example, if your full retirement age benefit is $2,000 and you start at 62, you’ll receive just $1,400 per month. That 30% reduction is permanent and can also shrink survivor benefits for your spouse.

But there is a benefit of getting more years of payments. That can help if you need cash flow now or don’t expect to live into your 80s or 90s. The Social Security Administration notes that about 1 in 3 people who turn 65 today will live to at least 90—and women tend to outlive men. So if you’re in good health and have other income sources, delaying can pay off. But if your personal or family health history points to a shorter lifespan, starting early could make financial sense.

Keep working? You might delay benefits—or owe a clawback

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Planning to keep working past 62? That can affect how much of your Social Security benefit you actually receive. If you earn more than the annual earnings limit before reaching full retirement age ($23,400 in 2025), Social Security may withhold some of your benefits. For every $2 you earn above the limit, $1 is withheld. 

This is a temporary reduction, not a tax. Once you reach full retirement age, you get credit for those months and your benefit amount increases. Plus, Social Security continues recalculating your benefit based on ongoing earnings. So if you’re still working and earning well, your future checks could get bigger over time.

Working longer also delays RMDs from retirement accounts and gives investments more time to grow, which could help lower your overall taxable income in early retirement.

Retirement tax planning means thinking beyond Social Security

Social Security is just one piece of your retirement tax strategy. Timing matters not only for maximizing benefits but also for minimizing your lifetime tax burden. 

Drawing Social Security while also tapping into pretax retirement accounts, like a traditional IRA or 401(k), could push you into a higher tax bracket.

This is where careful sequencing matters. Many retirees strategically draw from Roth accounts (tax-free) or taxable brokerage accounts first to stay under key income thresholds and reduce the tax hit on Social Security. Others delay Social Security to let traditional retirement accounts grow while converting some of those funds to Roth IRAs in lower-income years before RMDs kick in at age 73.

When you delay, everyone benefits—including your spouse

If you’re married, delaying Social Security may increase financial security for both you and your partner. When the higher-earning spouse delays claiming, the survivor benefit—what the surviving spouse receives after one partner passes—increases too. This is particularly important for women, who tend to live longer and are more likely to outlive their partner.

Delaying also creates a stronger income floor later in life, when healthcare costs and long-term care expenses can rise. If you’re the primary earner and can afford to wait, it’s often worth it—not just for your own lifetime benefit, but for the added survivor protection it provides.

A smart drawdown strategy supports long-term stability

Beyond deferring taxes, retirement planning takes a thoughtful approach to coordinate all income sources to maintain your lifestyle and avoid surprises. 

A well-balanced withdrawal strategy takes into account:

Each piece has ripple effects on the others. For example, drawing down taxable brokerage assets early can lower future RMDs, giving you more control over tax brackets and Medicare premiums. Or, starting withdrawals from a traditional IRA before Social Security might help avoid benefit taxation later. 

The playbook looks different for every retiree. But starting with a clear understanding of your goals, timeline, income mix, and tax profile can help you and your advisor build a strategy that protects your future and your family.

Get started with Harness

Everyone’s retirement path is different. At Harness, we help you create a personalized tax strategy based on your full financial picture, looking at equity comp, savings, real estate, retirement accounts, and more. A smart Social Security decision is just one part of the equation.

Get started with Harness to connect with a vetted advisor and plan your next chapter with confidence.

Disclaimer:

Tax related products and services provided through Harness Tax LLC. Harness Tax LLC is affiliated with Harness Wealth Advisers LLC, collectively referred to as “Harness Wealth”. Harness Wealth Advisers LLC is a paid promoter, internet registered investment adviser. Registration does not imply a certain level of skill or training. This article should not be considered tax or legal advice and is provided for informational purposes only. Please consult a tax and/or legal professional for advice specific to your individual circumstances. This article is a product of Harness Tax LLC.

Content was prepared by a third-party provider and not the adviser. Content should not be regarded as a complete analysis of the subjects discussed. Although we believe the content is reliable, it is not guaranteed as to accuracy and does not purport to be complete nor is it intended to be the primary basis for financial or tax decisions.