Updated

Updated · AOL · Nov 6

Inflation Pushes Retirees Toward Social Security at 62 as 2.8% COLA Rewards Waiting Until 70

Updated

Updated · AOL · Nov 6

Inflation Pushes Retirees Toward Social Security at 62 as 2.8% COLA Rewards Waiting Until 70

Q: Could inflation drain your retirement savings before you even reach the age to claim your maximum Social Security benefits?

Yes. Inflation can drain retirement savings fast enough that some people may not be able to wait until 70, the age for the maximum Social Security benefit. The reason is simple: many retirees use a “bridge strategy,” drawing on savings, 401(k)s, IRAs, taxable accounts, or part-time income to cover expenses between retirement and claiming Social Security later. When inflation pushes up housing, groceries, insurance, and medical costs, those bridge assets can be spent down much faster than planned. If markets are also weak, retirees may be forced to sell investments at lower prices, increasing sequence-of-returns risk and making savings less likely to last. That matters because waiting can be valuable. For people born in 1960 or later, full retirement age is 67, and delaying from 67 to 70 raises benefits by about 8% a year, or roughly 24% total. A person claiming at 70 can receive about 77% more per month than someone claiming at 62. Larger checks also mean larger future COLA increases in dollar terms, since each inflation adjustment is applied to a higher base benefit. But that advantage only helps if a retiree can afford to wait. If inflation is eroding savings too quickly, claiming earlier may be the safer move. Health, life expectancy, taxes, spouse and survivor needs, and the pace of portfolio withdrawals all matter. Financial planners generally advise stress-testing cash flow and inflation assumptions before deciding whether savings can realistically carry you to 70.

3 articles · Updated · AOL · Nov 6

A 2.8% Social Security cost-of-living increase for 2026 is complicating claiming decisions by cushioning inflation while also underscoring how rising living costs can force retirees to file earlier.
Age 62 remains the earliest claiming point, but benefits keep rising each month until 70; delaying locks in a larger base that also receives bigger dollar COLA increases over time.
Housing, groceries, insurance and medical bills can erode savings fast enough to break the common bridge strategy of living off 401(k)s or IRAs before claiming Social Security.
Waiting still tends to pay off for people who live into their 80s or 90s and for higher-earning spouses, because a larger benefit can also raise survivor income.