Claiming Wisely: Social Security & Income Planning (October 2025)
Many couples nearing retirement, assume the best approach is to start Social Security as soon as they are eligible. Their logic is simple: “We’ve paid into the system all these years. Let’s start getting something back.”
It’s a common mindset. But taking a step back and reviewing retirement income plan models over multiple scenarios, can reveal a different strategy —one that can provide more control over taxable income and positioned retirement savings for greater longevity.
The Power of Timing
For most individuals, Social Security benefits can begin as early as age 62, but claiming before full retirement age (FRA) results in a permanent reduction in monthly payments. Conversely, delaying until age 70 can increase benefits by up to 8% annually due to delayed retirement credits. This increase is not just about maximizing monthly income; it’s about enhancing inflation-protected, guaranteed income that reduces reliance on portfolio withdrawals.
Carefully selecting your claiming age isn’t a one-size-fits-all decision. For married couples, coordinating benefits between spouses can create both short-term flexibility and long-term security. Often, it makes sense for the higher earner to delay benefits to maximize survivor benefits, while the lower earner claims earlier to support current cash flow. This coordinated approach allows couples to balance today’s needs with tomorrow’s risks.
Income Planning: A Multi-Variable Equation
At John Moore Associates, we often emphasize the principle, “Spend less than you earn.” In retirement, this principle evolves into: “Withdraw less than your sustainable income allows.” Achieving this requires careful sequencing of income sources—particularly Social Security and IRA distributions—to manage tax brackets and avoid unnecessary surprises.
Many pre-retirees are unaware that up to 85% of their Social Security benefits can be taxable depending on their “provisional income,” which includes half of Social Security benefits plus all other taxable income, including IRA withdrawals. By delaying Social Security and using pre-tax IRA withdrawals in early retirement years (often referred to as the “tax planning window”), retirees may reduce the amount of their benefits subject to taxation later.
Moreover, early IRA withdrawals during this window can help lower future Required Minimum Distributions (RMDs), which begin at age 73. Lower RMDs translate to lower taxable income and potentially help preserve financial flexibility in later retirement.
Other Important Factors to Consider
Social Security claiming decisions rarely happen in a vacuum. A financial planner can help evaluate how other life and financial circumstances may influence the optimal strategy. These might include:
- Longevity expectations based on family history or current health.
- Part-time work during retirement that could reduce or delay benefits.
- Eligibility for benefits as a divorced or widowed spouse.
- Coordination with pension income and its impact on taxation.
- Anticipated inheritance and how it may affect income needs or taxes.
- Sale of a business or other large one-time events that can temporarily increase taxable income.
- State of residence, as some states tax Social Security differently or provide unique benefits to retirees.
Each of these factors can impact the best time and method to claim benefits—and why personalized guidance is so valuable.
Stewardship Through Intentional Planning
Faithful stewardship isn’t reactive; it’s intentional. Retirement income planning is not just about making ends meet, but aligning your resources with your values and goals.
Every retirement journey is different, but the principle is the same: understand the rules, evaluate the interactions, and apply wisdom in timing. With intentional planning, you can extend the impact of what God has entrusted to you and avoid common missteps that can diminish long-term security.
If you’re approaching retirement and unsure how to coordinate Social Security and your income plan, a financial advisor can help you navigate and the road ahead and build the plan that works best for you. You can look for an advisor who aligns with your Christian values at www.kingdomadvisors.com.