Suze Orman Says Claiming Social Security Early Could Hurt You: 4 Points to Consider Before Making Your Claim

Financial expert Suze Orman is cautioning retirees against the common urge to claim Social Security benefits at age 62. While early filing provides immediate cash, it triggers a permanent 30 percent reduction in monthly payments compared to waiting until full retirement age.

Many people view the break-even age as the primary metric for their decision. Orman suggests shifting this mindset to view delayed filing as insurance against longevity. If you live a long life, those larger monthly checks provide necessary stability for rising costs later in retirement.

Concerns regarding potential future benefit cuts due to Social Security funding issues often drive early claims. Orman points out that filing early locks in a reduced base, which leaves individuals more vulnerable if government adjustments to the system occur. Waiting until age 70 yields the maximum possible benefit, which offers better protection for both the retiree and their surviving spouse.

Choosing to delay payments is a strategic financial decision that benefits long-term planning. By prioritizing a higher monthly base, retirees ensure they have more resources during the later years of their lives when healthcare and living expenses are often higher.