You have spent decades saving for retirement. Now that retirement is approaching, one of your biggest decisions is when to start collecting Social Security.

Is it better to take the money now or wait for a larger monthly benefit? The answer may have as much to do with your spouse as it does with you.

Social Security recently announced a 3.6% cost-of-living adjustment for 2027. But even with higher benefits on the way, one important question remains:

Should you claim now or wait?

If you're 64, have saved $1.2 million for retirement, and are thinking about claiming Social Security, taking the money now might sound appealing.

But what if waiting until 70 could give you more income throughout retirement and leave your spouse with a larger benefit if you pass away first?

Let's look at the numbers.

What Does Waiting Until 70 Actually Get You?

Imagine a married couple approaching retirement. The higher-earning spouse is 64, the lower-earning spouse is 62, and together they have saved $1.2 million.

Let's assume the higher earner is eligible for $2,800 per month at full retirement age (67).

Depending on when they claim, their monthly benefit could look like this:

The difference?

By waiting until 70 instead of claiming at 64, the higher earner could receive an extra $1,232 per month.

That's nearly $14,800 more per year.

Why such a big difference?

Social Security reduces your benefit when you claim before full retirement age. For someone with a full retirement age of 67, claiming at 64 means a 20% reduction.

On the other hand, waiting beyond 67 increases your benefit by 8% for each full year you delay, up to age 70.

Of course, waiting means giving up years of payments along the way.

So when does waiting actually pay off?

The Break-Even Point: How Long Do You Need to Live?

If the higher-earning spouse waits until 70, they give up six years of potential Social Security payments.

Using our example, that's approximately $161,280 they could have collected between ages 64 and 70.

But once they turn 70, they receive an extra $1,232 every month compared with claiming at 64.

At that rate, it takes roughly 11 years for the larger benefit to make up for the payments they gave up.

The break-even point is around age 81.

In simple terms, if the higher earner lives beyond approximately age 81, waiting until 70 could result in more total Social Security income.

This is a simplified calculation that doesn't account for taxes, investment returns, or the time value of money.

But for married couples, there's another part of this decision that may be even more important.

What Happens to Your Spouse If You Pass Away First?

When couples look at Social Security, they often focus on how much income they will receive together.

But what happens when one spouse passes away?

A surviving spouse may qualify for a benefit based on the deceased spouse's work history. At the survivor's full retirement age, that benefit can generally be as much as 100% of the deceased spouse's benefit.

And this is where waiting can make a big difference.

Using our example, the higher earner's benefit at age 70 would be $3,472 per month. If they had claimed at 64 instead, the survivor benefit would be about $2,310, because Social Security gives surviving spouses a small floor when the deceased claimed early.

If the higher earner passes away first, the surviving spouse may qualify for the higher benefit, subject to Social Security's rules.

That's a difference of about $1,162 per month.

If the surviving spouse lives another 20 years, that difference could add up to nearly $279,000 in additional income, before future cost-of-living adjustments.

Think about that for a moment.

A surviving spouse may still have many of the same expenses they had as a couple, but now with one less Social Security check coming into the household.

Having a larger guaranteed benefit can help provide more financial security during an already difficult time.

This is one reason delaying Social Security can be especially valuable for married couples. The decision isn't just about how long you live. It's also about how long your spouse may need that income.

How Do You Pay the Bills While Waiting?

There's one obvious problem with waiting until 70.

You still need money to live on.

If you retire at 64 but wait six years to claim Social Security, you'll need another source of income to cover that gap.

For our couple with $1.2 million saved, that could mean using some of their retirement savings.

Replacing the higher earner's $2,240 monthly benefit would require approximately $26,880 per year, or $161,280 over six years, before taxes. If that money comes from a traditional IRA or 401(k), the amount withdrawn would need to be higher to cover income taxes.

The actual amount could be lower if the couple has other income, including the lower-earning spouse's Social Security benefit.

But here's where retirement planning and tax planning can work together.

The years between retirement and age 70 may create an opportunity to withdraw money from traditional retirement accounts or convert some of those savings to a Roth IRA.

Many retirees have lower taxable income after leaving work but before required minimum distributions (RMDs) begin. For anyone born in 1960 or later, RMDs don't start until age 75, so that window can stay open well past age 70.

That can create an opportunity to move money into a Roth IRA at a tax rate that may be lower than what they would pay later.

The key is coordinating these decisions.

You want to make sure you're not taking too much from your portfolio, creating an unnecessary tax bill, or increasing future Medicare premiums through poorly timed Roth conversions.

With careful planning, the same years used to bridge the Social Security gap could also help reduce future taxes.

Is Waiting Until 70 Always the Right Choice?

Not necessarily.

Claiming earlier may make more sense if you have serious health concerns, need the income to cover living expenses, or would have to take too much from your retirement savings to delay.

Your spouse's financial needs also matter. The value of a larger survivor benefit will depend on your household's circumstances.

The goal isn't to delay Social Security at all costs. It's to understand how each option affects your income, taxes, investments, and spouse's financial security.

The Bigger Question: Have You Looked at the Whole Picture?

If you're approaching retirement with $750,000 to $2 million saved, deciding when to claim Social Security is about much more than choosing a date.

Could using your savings to delay Social Security improve your long-term income?

Could those same years create opportunities to reduce future taxes?

And would waiting provide your spouse with more financial security if you pass away first?

These are questions worth answering before you file for benefits.

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Thanks for reading!
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​Keeping wealth in focus,

The MY Wealth Management Team