Three Value Investor Reasons to Claim Social Security in 2026

For those turning 70 in 2026, claiming Social Security is no longer an investment decision-it's a capital allocation choice that has already been made. The program offers a guaranteed, inflation-indexed annual return of 8% for each year you delay claiming past full retirement age. This is a compounding asset with a built-in expiration date: the benefit increase stops at age 70. If you are turning 70 this year, that compounding period is complete. Waiting another month provides no additional return.

The math is straightforward. By delaying from age 67 to 70, you secure a 24% total increase to your monthly benefit. This is a real, risk-free return on your time and patience. For a value investor, this is the kind of predictable, long-term compounding that is hard to find elsewhere. The decision in 2026 is not about the current inflation rate or tax brackets, which are just noise. It is a personal break-even calculation: whether the guaranteed 24% return is worth the trade-off of receiving checks for a shorter period.

The bottom line is that the opportunity cost of not claiming is now zero. You have already captured the full benefit of the 8% annual incentive. To wait further is to forgo a known, fixed return without any compensating upside. For the disciplined investor, the time to realize this locked-in gain is now.

Reason 2: The Margin of Safety Favors Claiming at Age 70

For the value investor, the decision to claim Social Security is a classic trade-off between a known present value and a future stream of uncertain payments. The core concept is the break-even age-the point where the total lifetime benefits from delaying finally equal those from claiming earlier. This age typically falls between ages 78 and 82 for most people, depending on their specific benefit amount and life expectancy.

The key insight for those turning 70 in 2026 is that this break-even age has already passed. By waiting until 70, you have secured a 24% total increase to your monthly benefit compared to claiming at full retirement age. This is not a future promise; it is a realized margin of safety. You have captured the full 8% annual incentive for three years of patience, and the compounding period has ended. The downside risk of living longer than the break-even age is now a non-issue; you have already crossed that threshold. The uncertainty is no longer about whether you will outlive the delayed benefits-it is about whether you will outlive the benefit you are already receiving. For a disciplined investor, the margin of safety is in the present, tangible increase.

The bottom line is that the trade-off has shifted decisively in favor of claiming. The guaranteed 24% boost provides a tangible buffer against inflation and longevity risk. Waiting further offers no additional return and introduces no new upside. The margin of safety is realized, and the prudent move is to claim.

Reason 3: Systemic Risks and the 2026 Policy Landscape

For the value investor, the final piece of the puzzle is assessing the systemic risks and the forward policy backdrop. The decision to claim at 70 is not made in a vacuum; it is shaped by long-term trends and specific triggers that could alter the calculus. The primary risk is underestimating life expectancy. If you live beyond the break-even age-typically between 78 and 82-delaying benefits provides a superior financial outcome. This is the core vulnerability of claiming early. For those turning 70 in 2026, the trade-off has already been resolved in their favor, but the risk of living longer than expected remains a personal, not a programmatic, uncertainty.

On the policy front, two factors deserve monitoring: future cost-of-living adjustments (COLAs) and potential tax changes. The 2026 COLA of 2.8 percent is a neutral background factor. It will boost benefits starting in January, with the average retirement check rising to about $2,071. However, this increase is partially offset by a 9.7 percent hike in Medicare Part B premiums, which will climb to $202.90 per month. The net real gain for many is therefore less than the headline COLA suggests. More importantly, the 2026 COLA does not change the fundamental trade-off of delaying benefits, which is already locked in for those at age 70.

The other key policy number is the $184,500 taxable maximum for Social Security taxes. This sets the ceiling on earnings subject to the 6.2% payroll tax. While this figure is a routine annual adjustment, it influences the long-term solvency of the trust fund and could become a focal point for future legislative debates. Any change to the tax structure or benefit formula would be a systemic risk, but such changes are typically incremental and long-dated.

For the disciplined investor, the forward-looking checklist is simple. First, ensure your personal break-even age is understood. Second, monitor future COLA announcements for trends in inflation indexing. Third, watch for any proposed changes to the taxable maximum or tax rates, which could affect the real value of benefits over decades. The 2026 landscape provides a stable, predictable backdrop. The 2.8% COLA and $184,500 maximum are known variables. The real investment decision, for those turning 70, is complete. The margin of safety is secured.