In the days following his 67th birthday, Marty McGowan made a decision that deviated from his original retirement plan: he filed for Social Security benefits earlier than anticipated.
Shortly after turning 67, Marty McGowan chose to change his retirement strategy by applying for Social Security benefits sooner than he had initially planned. Originally, he aimed to wait until age 70 to maximize his monthly benefit by an extra $800. However, recent economic instability and the possibility of changes to Social Security policies caused him to act sooner.
Like many others nearing retirement, McGowan worried that postponing his claim could risk his future eligibility or the amount of his benefits.
Rise in Social Security Claims: A Reflection of Economic Anxiety
McGowan’s early filing is part of a growing pattern. Data from the Urban Institute reveals that in fiscal year 2025, an additional 276,000 retirees applied for Social Security compared to 2024—a 13% rise.
This increase is largely driven by concerns over the reliability of the Social Security system amid financial uncertainty. Jack Smalligan, a senior policy expert at the Urban Institute, pointed out that many people risk reduced lifetime benefits when filing early.
Rumors about significant fraud within the Social Security Administration and efforts by the Trump administration to reduce the size of federal agencies heightened public unease, prompting many to file their claims as soon as they became eligible.
The Economic Uncertainty and Its Impact on Social Security Decisions
The uncertain future of Social Security, combined with talk of job and benefit cuts, caused many to seek early access to their retirement benefits.
Concerns that legislative or administrative changes could reduce or restrict future benefits drove this surge in early claims, despite the long-term financial drawbacks. Leland Dudek, acting commissioner of the Social Security Administration, admitted during an internal meeting that exaggerated fears in the media likely played a role in pushing people to file early.
COMPARISON OF SOCIAL SECURITY BENEFITS BY FILING AGE
| Filing Age | Monthly Benefit Amount | Lifetime Benefit | Effect on Payout |
|---|---|---|---|
| Age 62 | Reduced | Lower overall | 30% reduction |
| Age 67 | Full | Standard | No reduction |
| Age 70 | Increased | Higher overall | 8% increase per year |
Long-Term Impact of Early Social Security Claims
Opting to take Social Security earlier than planned may offer short-term peace of mind, especially during uncertain times. But this choice often results in smaller lifetime payouts.
Someone who starts receiving benefits at 62 instead of the full retirement age of 67 will likely see their monthly amount reduced by around 30%. On the other hand, delaying the claim each year beyond age 67 can raise the monthly benefit by about 8% annually until age 70.
Experts advise that Social Security should be viewed as a form of longevity protection. For those expecting to live well into their 80s or beyond, waiting to claim can provide more security and a better return compared to private annuities.
McGowan’s Story: Concerns About Policy Changes and Market Fluctuations
McGowan’s decision was not made without careful thought. He and his wife Lynn had long planned to wait until he turned 70 before claiming Social Security.
However, political unpredictability during President Trump’s term and economic volatility, including a sharp decline in their investments, led them to reassess. Even though the financial markets eventually rebounded, the experience reinforced McGowan’s decision to secure benefits early as a safeguard.
Surge in Claims: The Social Security Administration’s Response
The trend of early claims is expected to continue. The Social Security Administration forecasts nearly 4 million retirement benefit applications in fiscal year 2025, which is a 15% jump from the previous year—well above the standard 3% annual increase.
As of April 2025, there were 614,158 pending applications for retirement, survivor, and health benefits, compared to 460,158 in April 2024.
This sharp rise demonstrates how political and economic instability has influenced retirees’ financial planning. While filing early may offer immediate support, it usually leads to lower monthly and lifetime benefits.
Those who are financially stable enough to delay may find greater long-term value, particularly as people live longer and need their savings to stretch further. Each retiree should weigh their unique circumstances—such as health, income needs, and the broader economy—before deciding when to claim benefits.
FAQs
What are the disadvantages of claiming Social Security early?
Claiming early generally leads to smaller monthly payments. For example, filing at age 62 instead of waiting until age 67 can result in a 30% reduction in benefits. Conversely, waiting until age 70 increases benefits by approximately 8% per year.
Is it ever a good idea to claim Social Security early?
Yes, in certain cases. If someone urgently needs income or is facing financial hardship, claiming early may be necessary. Still, for most individuals, waiting until full retirement age or longer yields a better overall return.
How has the recent political and economic climate affected Social Security claims?
The combination of political tension, potential job cuts within the Social Security Administration, and market instability has led to a noticeable increase in early claims. Many are choosing to claim now out of concern that waiting could result in reduced or lost benefits.
Janice R. Phillips is a seasoned finance writer with a keen eye for simplifying complex financial concepts. With over a decade of experience covering personal finance, investing, and economic trends, she empowers readers to make informed money decisions. Janice specializes in creating content that bridges the gap between financial theory and real-world application, making her a trusted voice for both novice and experienced investors.