Should You Claim Social Security Early? Why Fear Might Be Costing Retirees Thousands

Anxiety about the future of Social Security is driving a wave of early retirement claims, even though doing so could mean locking in lower income for life.

According to the Social Security Administration, pending claims for retirement, survivor, and health insurance benefits jumped to nearly 581,000 in March, up more than 16% from the same time last year. Officials suggest that widespread fear, rather than financial planning, may be influencing many of these decisions. One administrator put it bluntly: “Fearmongering has driven people to claim benefits earlier.”

The Psychology of Scarcity

That fear is not new. Nearly half of U.S. workers say they don’t believe Social Security will be there for them when they retire, a level of distrust that has remained steady for over three decades, according to Gallup polling. Confidence is especially low among mid-career workers aged 30 to 49—people far from retirement, but close enough to start worrying.

While politicians regularly vow not to cut benefits, that hasn't stopped concern from mounting. With headlines warning of program insolvency by 2033 if Congress fails to act, it's no wonder workers are skeptical.

Yet policy analysts remain adamant: Social Security isn’t going away. The system may need reform, but it continues to provide critical income to tens of millions of Americans.

The Cost of Claiming Early

Unfortunately, acting on those fears can be financially damaging. Claiming Social Security benefits at age 62 locks in the lowest possible monthly payout. On the other hand, delaying until age 70 increases benefits by a staggering 76%.

Someone who delays claiming benefits until age 70 instead of starting at 62 would come out ahead financially if they live to at least age 80, and with rising life expectancy, that more be a bigger concern than many people realize.

So why do so many people still claim early? The reasons vary—health concerns, job loss, or a simple lack of information—but emotional responses to news coverage also play a measurable role. A study from the Center for Retirement Research at Boston College found that negative reporting on Social Security's finances leads more people to consider claiming early.

A System Under Strain

It’s true that Social Security faces structural headwinds. The aging population has long put pressure on the system, and without legislative changes, trust fund reserves could be exhausted within a decade. If that happens, benefits could be automatically cut by around 21%.

Still, it's essential to remember: Social Security is not bankrupt. It's a pay-as-you-go system supported by more than $1 trillion in worker contributions last year alone, and while reform is needed, outright collapse remains unlikely.

The Bottom Line: Don’t Let Fear Steer Your Retirement

Social Security is complex, it’s emotionally charged, and for many, it’s confusing.

That’s why it’s so important to separate fear from fact. If you're younger and worried about the future of Social Security, now is the time to strengthen your personal retirement savings strategy. The earlier you start, the more flexibility you’ll have, regardless of what happens in Washington.

If you're closer to retirement age, it's critical to understand your options. Claiming too early could cost you tens of thousands of dollars over the course of your retirement. At Hanover, we can help you optimize your Social Security strategy so you get the most from the system you've been paying into for decades.

Don’t let fear undermine your future. Let’s talk about a plan that puts you back in control.