From Income Stream to Legacy Strategy
Social Security is often viewed as a guaranteed check given at retirement. In the latest episode of Quarter over Quarter, hosts Don Drury and Tom Moran, AIF®, joined by special guest Aaron Simpson, CFP®, CLU®, ChFC®, RICP®, to explore how the when and how of claiming Social Security can make a six-figure difference over a lifetime.
Many retirees default to collecting benefits at the earliest possible age of 62, but that decision can result in a benefit reduction of up to 30%, according to the Social Security Administration. For those who can afford to wait, each year of deferral between full retirement age (typically 67) and 70 increases benefits by approximately 8%, making it one of the most reliable guaranteed returns available in retirement.
Fitting Social Security into a Broader Financial Plan
For high-net-worth investors, Social Security may not be a primary income source, but it’s far from irrelevant. Treating these payments as part of your fixed income allocation can reduce stress on your investment portfolio during volatile markets.
Predictable income from Social Security can act like a high-quality bond, allowing investors to maintain a more growth-oriented allocation elsewhere. Moran’s planning team models various claiming ages and integrates them into each client’s broader cash flow, tax, and legacy projections.
Spousal Coordination and Tax Awareness
One of the most overlooked strategies involves spousal coordination. A higher-earning spouse who delays until 70 not only maximizes their own benefit but also locks in a higher survivor benefit for their partner. Meanwhile, the lower-earning spouse can claim earlier to start partial income flow.
Beyond timing, tax efficiency is crucial. Deferring Social Security can open a window between retirement and age 73 (when RMDs begin) for Roth conversions, helping to manage future tax brackets and Medicare premium surcharges. These coordinated moves can preserve more wealth across generations.
If You Delay and Pass Away Early
For individuals without a spouse or dependent child, unclaimed Social Security benefits do not transfer to heirs or an estate. The system is designed as lifetime income protection, not a legacy asset. If benefits are never claimed, those payments simply don’t accrue to beneficiaries.
That’s why timing your claim is as much about life expectancy and lifestyle goals as it is about maximizing a number. For those without dependents, it could make sense to claim earlier, ensuring the income supports charitable giving, travel, or other goals while you’re here to enjoy it.
Turning Income into Impact
Even among affluent families who don’t rely on Social Security for everyday expenses, these benefits can still play a meaningful role in a well-rounded wealth strategy. Following a common wealth principle, if you don’t need it, give it away, Social Security income can become a tool for purposeful planning rather than passive accumulation.
By redirecting this income toward charitable giving, donor-advised funds, or family gifting strategies, investors can create lasting value from an otherwise modest government benefit. Structured thoughtfully, these approaches can reduce taxable income, strengthen philanthropic legacies, and introduce the next generation to intentional wealth stewardship.
At Moran Wealth Management®, we help clients explore how Social Security benefits can be integrated into broader legacy and impact planning, ensuring that every dollar supports their vision for family, community, and future generations.
Key Takeaway
There’s no one-size-fits-all Social Security strategy. The optimal claiming age depends on your health, income streams, tax profile, and legacy goals. Whether it’s coordinating spousal benefits, planning Roth conversions, or aligning Social Security with your charitable vision, timing can change the entire trajectory of your retirement plan.
At Moran Wealth Management®, we help clients model multiple scenarios to see how Social Security fits within a larger wealth strategy by balancing income needs, risk, taxes, and legacy potential partner with our team to review your unique situation and make confident, data-driven decisions for the future.
To learn more about retirement and wealth planning, explore our Insights Library for additional educational resources and perspectives from the Moran Wealth Management® team.
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