Claiming Social Security early is ‘bad advice,’ says Suze Orman, despite virus panic
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As concerns grow about the long-term solvency of the Social Security trust funds, a growing number of Americans are rushing to claim their benefits early out of fear that the program will end.
However, personal finance expert Suze Orman warns that following this dangerous advice will lock retirees into a permanent financial penalty that cannot be reversed.
“There has been some discussion on social media recently about Social Security that I think is bad advice,” Orman wrote earlier this month on his website. “The message is that it’s better to claim as soon as possible — when you’re 62 — than to wait to collect a big benefit by starting your checks later. That’s not good advice.”
About two weeks ago, the Social Security Administration released its 2026 Trustees report, which confirms that the retirement safety net is less than seven years away from the depletion of the reserve, as the Old-Age and Survivors Insurance (OASI) Trust Fund is expected to use its accumulated reserves in the fourth quarter of 2032.
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Once the savings are depleted, continuing tax revenue will cover only 78% of planned retirement benefits, according to the report.
People wait in front of the Public Safety office in Citrus Heights, California, on July 12, 2023. (Getty Images)
According to SSA data, claiming retirement benefits at age 62 remains popular among retirees, although filing early keys to lower monthly benefits.
“For anyone born in 1960 or later, your Full Retirement Age is 67. That’s when you’re entitled to 100% of your earned Social Security benefits. If you choose to start collecting at age 62, you get 70% of that benefit — a 30% reduction that’s locked in forever. Filing early is accepting a penalty,” Orman said.
“The average life expectancy woman who reaches age 65 lives to be 88 years old. That means there’s a 50% chance she’ll still be alive at 88 — she’s still around, she’s still paying bills, she’s still needing income. If she reaches her retirement age—even at age 79, there’s a very real chance she’ll have at least a decade or more ahead of her,” Orman said. “Every month past that break point, the person waiting collects more meaningfully.”
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The personal finance expert has also pushed back against claims circulating online that filing early protects your benefits before the trust funds drop.
“Current forecasts suggest that if Congress does nothing, Social Security will pay about 80% of scheduled benefits – a 20% reduction. That’s a very bad scenario. And as I’ve discussed before, Social Security has survived funding challenges before; in the early 1980s, Washington found solutions that did not require beneficiaries to receive the full cost,” he said.
“If your benefit at 67 would be $2,000, that’s 62 keys to a monthly payment of $1,400… Now use the 20% worst-case cut for both. Someone who waited until age 67 might see their benefit reduced from $2,000 to $1,600. An early claimant collects about $1,260.”
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Orman said there are two exceptions to claiming Social Security early: health issues and not being able to work or access retirement savings.
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And the “strongest move,” according to Orman, is to wait until age 70 to receive Social Security benefits.
“If you’re married, please wait for the highest earner as long as possible — ideally until 70. The surviving spouse gets the biggest benefit of the two. Making that number as big as possible is one of the most important financial gifts you can leave your spouse,” Orman said.
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