Business & Finance
Why experts advise delaying Social Security claims despite rising cost-of-living projections
With the 2027 COLA projected to reach up to 3.6%, financial advisers explain why waiting to claim benefits still offers a greater long-term payout.
The short version
- The 2027 Social Security cost-of-living adjustment (COLA) is projected to reach between 3.4% and 3.6% due to elevated inflation, with the official announcement expected in October.
- Financial experts advise that delaying claims past full retirement age up to age 70 yields an 8% benefit increase per year and maximizes the compounding effect of future COLAs.
- While waiting is generally recommended, individual health statuses, immediate financial needs, and concerns over trust fund insolvency in six years remain key variables in the decision.
Key facts
- Early projections estimate that the 2027 Social Security cost-of-living adjustment (COLA) may range from 3.4% to 3.6%, which would follow a 2.8% boost in 2026.[CNBC]
- The Social Security Administration officially calculates the annual COLA in October using third-quarter inflation data.[CNBC]
- Delaying Social Security claims beyond full retirement age up to age 70 results in a permanent 8% benefit increase for each year of delay.[CNBC]
- Research by Mavericus Retirement Services indicates that waiting from age 62 until 70 provides an approximate 76% increase in total benefits once compounding historical COLAs are included.[CNBC]
- The Social Security retirement trust fund is projected to run dry in six years, at which point incoming payroll taxes would fund only partial monthly benefits unless Congress intervenes.[CNBC]
What remains uncertain
- The exact impact of the U.S.-Canada trade war on the final COLA remains uncertain, though policy analyst Mary Johnson estimates its late third-quarter timing may limit its influence.[CNBC]
- It is unknown how or if Congress will address the projected retirement trust fund insolvency, which has prompted proposals like capping COLAs for higher-earning recipients.[CNBC]