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Older peoples' willingness to delay social security claiming

Author

Listed:
  • Maurer, Raimond
  • Mitchell, Olivia S.

Abstract

We have designed and implemented an experimental module in the 2014 Health and Retirement Study to measure older persons' willingness to defer claiming of Social Security benefits. Under the current system’ status quo where delaying claiming boosts eventual benefits, we show that 46% of the respondents would delay claiming and work longer. If respondents were instead offered an actuarially fair lump sum payment instead of higher lifelong benefits, about 56% indicate they would delay claiming. Without a work requirement, the average amount needed to induce delayed claiming is only $60,400, while when part-time work is stipulated, the amount is slightly higher, $66,700. This small difference implies a low utility value of leisure foregone, of under 20% of average household income.

Suggested Citation

  • Maurer, Raimond & Mitchell, Olivia S., 2021. "Older peoples' willingness to delay social security claiming," Journal of Pension Economics and Finance, Cambridge University Press, vol. 20(3), pages 410-425, July.
    • Handle: RePEc:cup:jpenef:v:20:y:2021:i:3:p:410-425_6
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    Cited by:

    1. Kitamura, Tomoki & Nakashima, Kunio, 2025. "Financial incentives for delaying the public pension claiming age," Journal of Behavioral and Experimental Finance, Elsevier, vol. 45(C).

    More about this item

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions

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