Should You Delay Social Security if You're Wealthy?
Here are three scenarios in which you might want to consider claiming Social Security benefits later if you have saved a significant chunk of change.


Saying someone is wealthy is like saying someone is happy. It’s subjective enough that I hesitated to even write this article. However, there are a few common themes that come along with wealth that impact when it may make sense to claim Social Security. For purposes of this article, we’ll say that “wealthy” means you have amassed at least $5 million.
In my experience of meeting with hundreds of wealthy folks every year for the last 15 years, there are some shared financial traits:
- They have shifted more toward optimizing their financial life over the fear of running out of money. (Unfortunately, that latter fear never totally goes away.)
- Typically, their non-retirement accounts are bigger than their retirement accounts. This is often for one of the following reasons: an inheritance, significant income during their working years, a business or asset sale.
- Taxes play an increasingly important role in their financial life, basically because of the two points above.
OK, so to answer the question this article started with: Should you delay claiming Social Security because you’re wealthy? In most cases, yes. Here’s why:

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
1. You don’t need the money.
Let’s start with fundamental need. If, as stated above, you have amassed significant non-retirement assets, you have liquidity and don’t necessarily need the money today.
Social Security will pay you handsomely for every month you delay beyond your full retirement age. These monthly increases add up to 8% per year, which is hard to match on a guaranteed basis.
2. You want to take advantage of the 'tax valley.'
Throughout your working years, you’re mostly summiting a tax peak. As your income increases, so too does your effective tax rate. Then comes retirement, and you can fall off a tax cliff and remain in a tax valley until you start to peak again. What causes that peak if you’re not working? Social Security income and required minimum distributions (RMDs) often have a significant impact on your tax rates.
Delaying Social Security until 70 can prolong the tax valley and may allow you to take advantage of those low rates. We are often helping clients recognize capital gains at lower rates and do Roth conversions in the period between retirement and 70.
3. You want to focus on legacy planning.
I would argue that since the SECURE Act of 2020, the Roth IRA has become the most tax-efficient way to leave a legacy to children. Life insurance agents would argue I’m wrong. They are conflicted. Like life insurance, Roth IRAs are left tax-free. Unlike life insurance, they maintain tax deferral typically for a period of 10 years beyond the decedent’s death.
Delaying Social Security allows you to convert traditional retirement accounts into Roth accounts while you’re in a lower tax bracket. Those accounts can then be invested aggressively if they are for legacy purposes.
In the early years of my career, we relied on a slew of different software and Excel spreadsheets to come up with a Social Security claiming strategy that made sense for our clients. The challenge is that the Social Security maximizers didn’t factor in goals or taxes. Now, the best planning software can pretty effectively tie all these things together and come up with an optimal solution. You can try a free version of our software.
Related Content
- Social Security COLA Increase for 2025 Could Be the Lowest in Four Years
- Social Security Optimization If You Save More Than $250,000
- Five Thoughts About the Election From a Financial Planner
- Three Reasons to Consider Roth Conversions in Your Peak Earnings Years
- What’s the Best Age to Buy Long-Term Care Insurance?
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

After graduating from the University of Delaware and Georgetown University, I pursued a career in financial planning. At age 26, I earned my CERTIFIED FINANCIAL PLANNER™ certification. I also hold the IRS Enrolled Agent license, which allows for a unique approach to planning that can be beneficial to retirees and those selling their businesses, who are eager to minimize lifetime taxes and maximize income.
-
So You Want to Age in Place: What Most People Overlook
If you want to age in place in your current home, near the beach or in the mountains, one risk could upend your plans. Here's what you need to know.
-
The 100 Minus Your Age Rule May Be the Easiest Asset Allocation Strategy, but Is It the Best?
The 100 Minus Your Age rule is a quick, back-of-the-envelope calculation that can help determine your appropriate allocation to stocks and bonds.
-
I'm a Wealth Adviser: If You're a DIY Investor, Don't Make These Five Mistakes
Even though you may feel confident because of easy access to investing information, you may be making mistakes that could compromise your long-term performance. Here's what you should know.
-
Building a Business That Lasts: The Critical Steps to Avoid Blunders
'Another Way' author David Whorton offers advice on how to build an 'evergreen' business that endures by avoiding common pitfalls that can lead to failure.
-
I'm a Financial Pro: Why You Shouldn't Put All Your Eggs in the Company Stock Basket
Limit exposure to your employer's stock, sell it periodically and maintain portfolio diversification to protect your wealth from unexpected events.
-
How Will the One Big Beautiful Bill Shape Your Legacy?
The One Big Beautiful Bill Act removes uncertainty over tax brackets and estate tax. Families should take time to review estate plans to take full advantage.
-
Should You Claim Social Security Early or Late? A Financial Adviser Weighs In
There isn't a wrong age to start claiming Social Security, but there are factors that everyone should consider to avoid leaving money on the table.
-
Three Things Financially Confident People Do, From a Pro Who Knows
If you have any worries about your retirement future, take back control with these three tips.
-
How Much Do I Need to Retire? A Financial Professional Breaks Down Your Options
What it all boils down to is will you be comfortable in retirement? Some people may rely on formulas, while others just aim for $1 million nest egg.
-
Despite Our Grumbles, America Still Delivers on the Dream: Perspective From a Financial Pro Who's Seen Stuff
Some of us might complain about the state of our nation (and those concerns are legit), but America still offers unparalleled opportunities and mobility that many people around the world only dream about.