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Episode Breakdown

Why So Many People Claim Social Security Early​
(0:00) Intro — the behavioral and emotional reasons retirees claim at 62, despite the math
(4:00) Retirement Headline: “What If Everyone Is Wrong About When to Claim Social Security?” from The New York Times​
(19:15) Listener Question: How to handle your HSA when transitioning to Medicare — and what the IRS rules actually say

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Retirement Headline: Why Claiming Early Isn’t Always a Mistake — But Often Is

Source: New York Times by Tara Siegel Bernard
​Article: What If Everyone Is Wrong About When to Claim Social Security?

You’ve heard the logic before: delay Social Security as long as you can, ideally to age 70, and lock in 8% annual increases. But here’s the twist—30% of retirees still claim as early as possible at age 62.

Why?

According to the article—and my own experience—the reasons are less about spreadsheets and more about psychology:

• Fear of dying early
• Lack of trust in the system
• Needing the money now
• Not wanting to touch 401(k)s or IRAs
• A strong “It’s my money and I want it now” mindset

But here’s the problem:​
Early claiming creates long-term risk—especially for surviving spouses. I’ve never had an 80-year-old widow tell me her Social Security check was too big.

Advisor Insight:​
We use spending guardrails to show clients when it's truly safe to delay benefits. Then we bridge the income gap with IRAs, Roths, or brokerage accounts depending on your tax picture.

Key Action Steps:

1. Don’t default to claiming just because you’re retired.
2. Run the numbers. Include spousal longevity in your breakeven analysis.
3. Model a “bridge” plan: fund early retirement from investments and turn on Social Security later.
4. Know that one of the best gifts you can give a spouse is a bigger survivor benefit.

Want to DIY this? You don’t need fancy software—a spreadsheet works just fine.

Listener Question of the Week

“When do I need to stop contributing to my HSA before Medicare? And how do I use it once I’m on Medicare?”

Great question—and a surprisingly tricky one. Threading the HSA-to-Medicare needle wrong can lead to taxes and penalties.

Part 1: When to Stop Contributing

• You must stop contributing the month before your Medicare coverage begins (Part A, B, or D).
• But here’s the kicker: if you delay Medicare, your Part A may still go back 6 months retroactively.
• That means you should stop HSA contributions at least 6 months before applying for Medicare.

Part 2: What You Can Use Your HSA For After 65​
Tax-free uses once enrolled in Medicare:

• Part B, Part D, and Medicare Advantage (Part C) premiums
• Long-term care insurance premiums (IRS limits apply)
• Deductibles, copays, dental, vision, hearing
• Qualified long-term care services

Not allowed:

• Medicare Supplement (Medigap) premiums

Pre-65 Exceptions:​
You can use HSA funds tax-free for:

• COBRA premiums
• Health insurance while on unemployment
• Long-term care premiums

But regular ACA or employer plan premiums while employed? Those are not qualified and subject to taxes and penalties if paid with HSA funds.

Resources Mentioned

• ​​​Click here to read Why Are So Many Retirees Filing for Social Security Earlier?
• ​Click here to order my book, Retirement Starts Today: Your non-financial guide to an even better retirement
• ​Click here to read IRS Publication 969
• ​Click here for IRS Notice 2004-50, Q&A-27

That's it for our three hundred and eighty-fifth installment of "Every Day is Saturday." As always, I read (and usually reply to) every listener email. Got a question? Hit reply—you just might hear your name on the show.

Enjoy your “Saturday,”
​Benjamin Brandt