The Strategic Case for Claiming Social Security at 65: Balancing Income Needs and Longevity Risk

The decision of when to claim Social Security benefits is one of the most consequential choices facing retirees, particularly those who embrace active lifestyles and seek to balance immediate income needs with the specter of longevity risk. For many, age 65 represents a pivotal crossroads: claiming benefits at this stage offers a steady income stream but risks underutilizing the program's potential to grow with time. Conversely, delaying benefits until age 70 can significantly boost monthly payments, yet this strategy demands careful consideration of health, financial priorities, and risk tolerance.

According to a report by BlackRock, delaying Social Security from age 65 to 67 can increase annual retirement spending by 16% and reduce downside risk by 15%. This math is compelling, but it assumes a retiree's ability to sustain expenses from other sources during the interim. For active retirees with robust investment portfolios or part-time work income, this delay can amplify long-term security. However, for those with limited savings or pressing financial obligations-such as healthcare costs or mortgage payments-claiming at 65 may be the only viable option.

The debate is further complicated by psychological and behavioral factors. Research from the Center for Retirement Research at Boston College highlights that individuals with a stronger aversion to financial loss are more likely to claim benefits early, even if it means accepting permanently reduced payments. Similarly, health status plays a critical role: retirees in poor health may prioritize immediate income over the long-term gains of delayed claiming. These dynamics underscore the need for personalized strategies rather than one-size-fits-all advice.

A key consideration is longevity risk-the risk of outliving one's savings. Data from the Social Security Administration reveals that a woman turning 65 today has a 1 in 3 chance of living to 90. To mitigate this, retirees can integrate annuities into their income plans. Fixed annuities, for instance, provide guaranteed lifetime payments, reducing reliance on volatile investment portfolios. A 2025 study by the Protected Retirement Income Project notes that combining annuities with Social Security and investments can enhance financial resilience, particularly for those with active retirement lifestyles requiring consistent cash flow.

Yet, the calculus isn't purely financial. Behavioral economics research identifies biases such as hyperbolic discounting and the planning fallacy as drivers of early claiming, even when delaying would yield higher lifetime benefits. These biases are exacerbated by a lack of understanding about Social Security itself: nearly half of Americans admit they don't know much about the program. Advisors and policymakers must address this knowledge gap, as misaligned expectations can lead to suboptimal decisions.

For retirees who do claim at 65, strategic integration with other income sources is essential. A "bridge" approach-using investments or part-time work to cover expenses before Social Security kicks in can preserve savings and allow for delayed claiming later. Additionally, the "claim-suspend-restart" (CSR) strategy offers a lifeline for those who claim early but later seek to boost benefits. By suspending payments after reaching full retirement age (67), retirees can earn additional credits, potentially increasing monthly benefits by up to 24% if restarted at 70 according to Fidelity's analysis.

Ultimately, the optimal claiming age hinges on a retiree's unique circumstances. For those with shorter life expectancies, immediate needs, or a high tolerance for market risk, 65 may be the right choice. For others, delaying to 70-paired with annuities and diversified investments-can maximize income and longevity protection. As EY's 2025 analysis demonstrates, hybrid strategies that blend guaranteed income with growth-oriented assets yield better outcomes than relying on a single source.

In an era of uncertain economic conditions and rising life expectancies, the strategic case for claiming at 65 is not about rejecting delayed benefits but about recognizing that flexibility and adaptability are paramount. Retirees must weigh their health, financial resources, and psychological comfort with risk to craft a plan that aligns with their active lifestyles and long-term goals.