Taking Social Security Benefits Early

Summary

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Jill on Money: Taking Social Security Benefits Early

Host: Jill Schlesinger, CFP®
Episode Date: August 11, 2026
Main Theme:
Exploring the nuances of claiming Social Security early, listener financial dilemmas, and actionable planning advice for retirees and investors.

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Episode Overview

On this episode, Jill addresses listener questions about Social Security timing, market risks versus guaranteed income, asset protection in retirement, and end-of-life financial strategies. Listeners share their unique financial situations, prompting discussions on everything from surplus pension income to inheritance tax rules—always with Jill’s trademark candor and practical expertise.

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Key Discussion Points & Insights

1. Superfan Shout-Out and Listener Engagement

• [01:03] Jill celebrates the show’s loyal fans, emphasizing the importance of listener involvement.
  • Jill tells a story about a superfan, Kevin, who hasn't missed an episode since March 2020, noting:

    “This guy has not missed an episode. I’m going to lunch with him!” (02:49 – Jill)

• Reminder: Listeners can submit their financial questions via the website.

  “If that's you, if you feel a little bit like, hey… I need a lift. Get in touch with us.” (01:28 – Jill)

2. Claiming Social Security Early vs. Delaying for Greater Benefit

• [02:56] Listener Kim asks whether to claim Social Security at 67 and invest the benefit, believing she could outperform by investing, or delay until 70 for a higher, inflation-adjusted benefit.
• Jill’s perspective:
  • Prefers delaying for the “automatic, guaranteed 8% increase” per year by waiting. Stresses the unique, risk-free nature of these government boosts.

    “There’s very few places where I can get an automatic and guaranteed 8% increase.” (03:48 – Jill)

  • Recognizes the market could outperform—but only if it keeps rising, which is not certain.

    “Of course, yes, you can make more, but it comes with risk.” (03:44 – Jill)

• Mark affirms: don’t overthink it if you don’t need the money immediately.

  “Don’t lose any sleepover because you said you didn’t need the money anyway… all is well.” (04:16 – Mark)

3. Retirement Account Security and Fraud Concerns

• [04:24] Lawrence, a semi-retired 70-year-old, worries about AI and cyberattacks emptying bank and investment accounts.
• Jill’s take:
  • Actual institution breaches are rare; more risk lies in ordinary scams (phishing, impersonation).

    “Probably the bigger risk is the run of the mill scam. I have to say, I think that is probably the bigger risk.” (05:09 – Jill)

  • Trusts that large institutions and regulators are vigilant.
  • Mark admits to trusting the system “blindly.” (05:01 – Mark)

4. Managing Surplus Pension Income in Retirement

• [05:30] Ronald, 81, divorced, risk averse, has $5,000 monthly surplus from pension and annuity, plus investments. Unsure what to do with excess cash, no legacy goal, wants to age in place.
• Jill’s advice:
  • Use surplus as needed, don’t overcomplicate Medicaid planning. If qualifying for Medicaid is the goal, simply spend down assets.

    “You want to qualify for Medicaid, spend your money down. If you don’t care, spend your money down.” (06:26 – Jill)

  • For the surplus, suggests laddering CDs or building up cash, not forcing investments that might increase stress.
• Mark concurs, recommending a comfortable cash buffer based on Ronald’s risk tolerance. (07:06 – Mark)

5. Inheritance and Capital Gains on Appreciated Stock

• [07:21] Ty asks about leaving highly appreciated stock ($3,900 in 1989, now $1M) to his kids and tax implications.
• Jill’s response:
  • Children receive a step-up in cost basis at death; no capital gains due if sold immediately after inheritance.

    “If Ty you drop dead tomorrow, the kids would basically inherit the stock as if they bought it on the date of death valuation… there would not be a tax due.” (08:14 – Jill)

  • Suggests a charitable alternative: donating stock to a Donor Advised Fund for a current tax deduction and legacy philanthropy.

    “You can use that exact same low basis position to fund a donor advised fund.” (08:38 – Jill)

6. Lump Sum vs. Pension Decision & Advisor Selection

• [09:29] Raymond, 70, is torn between lump sum payout or pension. Pension halves on death and lacks cost-of-living adjustment.
• Jill leans toward lump sum, especially considering lack of COLA and survivor benefits.

  “My inclination would be perhaps to take the pension in a lump sum, invest it in general, but I don’t think I’d put it in an annuity.” (11:08 – Jill)

  • Stresses importance of working with a “fee-only independent financial advisor” for unbiased guidance.

    “Should we look for a truly independent third party? As a financial advisor, yes, that’s usually what I like.” (11:44 – Jill)

  • Mark agrees, seeing more value in flexibility and independence for this couple. (12:24 – Mark)

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Memorable Quotes & Timestamps

• Jill (on Social Security):

  “There’s very few places where I can get an automatic and guaranteed 8% increase.” (03:48)

• Jill (on security):

  “Probably the bigger risk is the run of the mill scam…” (05:09)

• Jill (on surplus income):

  “Use your money, don’t jump through hoops to try to preserve it for Medicaid qualification if you don’t care about legacy.” (06:26)

• Jill (on inheritance):

  “If you leave it to your kids… they inherit it at date of death valuation, so there would not be a tax due.” (08:14)

• Jill (on advisor selection):

  “Should we look for a truly independent third party? As a financial advisor, yes, that’s usually what I like.” (11:44)

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Timestamps for Key Segments

• 01:03 – Listener engagement, superfan story
• 02:56 – Should you claim Social Security early or wait?
• 04:24 – Protecting accounts from cyber risk
• 05:30 – Managing monthly surplus at age 81; Medicaid & aging in place
• 07:21 – Leaving appreciated stock to children; taxes and donor advised funds explained
• 09:29 – Lump sum vs. pension; advisor selection advice

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Tone

Jill’s advice is clear, direct, and free from jargon. She balances levity (matchmaking jokes, stock speculation) with empathy and practical wisdom, always encouraging listeners not to stress unduly and to keep a big-picture perspective.

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Summary

This episode is a rich, relatable dive into the nuanced, sometimes emotional decisions facing retirees and investors about Social Security, investing, and legacy planning. Jill delivers actionable, confidence-building guidance with her trademark warmth and clarity, emphasizing security, simplicity, and the value of independent advice.

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Transcript

[Jill]

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[Jill]

Welcome to the Jill on Money show. It's Tuesday, August 11th, and we are here answering your financial questions. And we are also here trying to help you navigate through whatever it is is going on in your life that is touching your financial life. Sometimes it's not as obvious, you know, it's sometimes a much sort of tangential thing that brings something up about your financial life. And if that is something that you were interested in and talking about, then, I mean, I just think that we would love to hear from you. And I just think that that more and more we're hearing from people who are really kind of in touch with their financial lives, but maybe they don't see the big picture in the right way. And so if that's you, if you feel a little bit like, hey, you know, I need some help, I need another, I need an assist, I need a lift. Get in touch with us. Mark and I are both certified financial planners. You just need to go to jillonmoney.com, click the contact us button, write us a note, and if you would like to join us, then all you need to do is check the box and Mark will get you on. Mark, I just want to tell you that friend of the show Eddie says to me that he met a super fan of ours. How about that?

[Mark]

Yeah, this is your friend Eddie.

[Jill]

This is my friend Eddie who I love. He said that this guy. So shout out to friend of Eddie's, Kevin, who says he has not missed a single episode of the show since March of 2020. Wow. How about that? So that's Eddie and Martine's friend Kevin. I can't wait to meet you. I'm so excited. So I like to meet a super fan. I like someone who's not missed a show since March Just to put that in perspective for some of you newer listeners, we were seven days a week for many. For many years, basically. So this guy has not missed an episode. I'm going to lunch with him. What do you think, Mark?

[Mark]

Maybe he's a Brooklyn night, too.

[Jill]

He could be. He might be. I don't know where he lives. But anyway, Kevin, shout out to you. Thank you so much, Eddie and Martin, you know I love you. Okay, so, Mark, let's do some emails today. All right, first of all, we have Kim, who says, question. I don't need Social Security benefits to meet my monthly expenses. So I was going to wait until age 70. I decided to claim at age 67 and invest the money rather than wait for a higher benefit. I haven't crunched the numbers. I believe that I can make up the difference and more. You can, as long as the market's going up.

[Mark]

Of course she wants to believe that. Yes.

[Jill]

But I, I still love the idea of delaying and getting that automatic 8% increase. Also, that higher benefit is the one that keeps rising with a cost of living adjustment. So, of course, yes, you can make more, but it comes with risk. And there's very few places where I can get an automatic and guaranteed 8% increase. Right. So I get it. A lot of people think they can do this. I. I am not convinced that it is really the best thing. And, Kim, I mean, when the market turns, if we're in a bear market for a while and things are down, you may not think the math is working so well.

[Mark]

I would say, Kim, don't lose any sleepover because you said you didn't need the money anyway to meet your monthly nut. So I'm assuming all is well. So don't drive yourself nuts.

[Jill]

Yeah. All right. Lawrence wants to know whether I can hack into a retirement or bank account and what can we do to protect our accounts. He says, We're 70 years old and I'm semi retired and I worry about losing everything. Mark, this is a pretty intense question because I think there are a lot of folks out there who, you know, forget about the regular old scams. But you think, could some sort of artificial intelligence program break in, empty you out? And what I'm hopeful for is that all these big institutions are working to prevent that. Are you worried about this, Mark?

[Mark]

I am not worried about it. Yeah. I'm kind of blindly putting all my trust into those financial institutions,

[Jill]

which is about the only thing you would entrust with them. Listen, I do know that all of these institutions where you have your money My guess is that, you know, the big regulators are asking these questions of them and they're trying to make sure that they can prevent that. Probably the bigger risk is the run of the mill scam. I have to say, I think that is probably the bigger risk. Okay, Ronald says I am a healthy 81 year old. I'm divorced. Mark, maybe someone to fix up, maybe with my mom. Let me see if he has any money. He says I'm healthy, 81 year old, divorced man who has no debt. I am highly risk averse. A $5,000 monthly cash surplus from my pension, which is guaranteed for life and a lifetime annuity. He gets a Social Security payment. He has investment income and 300 grand in a brokerage account. What should I do with my monthly cash surplus? Should I be investing more if I can? I don't need a legacy for my children. I would like to age in place if needed instead of going to a facility. Travel requires too much stress and energy and I don't like to travel alone. See, Mark, this could be someone good for mom. I feel too old to find a compatible partner. I live in Florida. Oh, that's downside for my mom. She hates Florida. But I do like extended stays with my three kids who live all over the country. We'll use an asset and income trust if necessary for Medicaid. Approved, approved nursing home. What? Don't do that. Don't do that. Okay, first of all, let me start with this. You want to qualify for Medicaid, spend your money down. If you don't care, spend your money down. You're going to go through all this nonsense to all these hoops to get rid of, to keep your money safe. Just pay for it and then you'll qualify for Medicaid if that's what you want. But Mark, five grand a month at 81 surplus, what should he do?

[Mark]

I mean, he's very risk averse. He says so. I mean, you know, I don't want to say just like throw it all in the brokerage account. That might drive him nuts. So, I don't know, maybe try and find some balance that works for him. But I, you know, I would invest some of it and maybe just build up a cash account.

[Jill]

Yeah, I think you can build up your cash. You could, you could ladder some CDs. There is absolutely nothing to worry about. But I wouldn't dance around these things about like trying to qualify for Medicaid, so. All right, next up, Mark, we've got Ty, who says, I love your podcast and I listen to Money moves. Even though I'm not in the age group. Hey, feel free to listen. Feel free to watch everybody. Okay, so question. In 1989, Ty got stock from a company buyout and it came out to $3,900. Mark, hang on to your hat. The $3,900 in 1989, it's now worth over a million dollars. Oh my goodness, what a problem to have. I don't need the money to live on. I would like to leave it to my kids. And is it taxable to them? Okay, so if you leave it to your kids. This is one of the weird like parts of the tax law. When you leave an asset after you die, it is entitled to get what is called a step up in cost basis. So yes, you, you came to you and it was worth 3,900. It's worth a million dollars now. If Ty you drop dead tomorrow, the kids would basically inherit the stock as if they bought it on the date of death valuation or that million dollars. So there would not be a tax due. So there's no problem with it. You can also use that exact same low basis position to fund a donor advised fund. That is another thing to think about. I know you want to leave it to your kids, but if you want to try to use it today to help fund some charitable endeavors, you can open a donor advised fund. We talked about that on the show. Where you can basically transfer this money into the the donor advised fund. You take a tax deduction for today and then you can give it out over time. And even your kids could figure out how to give it out as well if you were to pass. So anyway, wow. 3900 to a million. What stock do you think it is? What could it be like Apple in 1989? It could be Apple because Apple had that weird dip in that period where like Steve Jobs left. So maybe it's that. I don't know. Okay, this is hysterical. This is from Raymond, a lump sum or pension question. But check this out. This is what he says. My wife tricked me into listening to you several years ago and I've been a fan ever since. I love your wife, Raymond. Okay. They're in a dilemma though. So Raymond says, I'm 70 years old, I'm about to retire. My wife is 68. She's been retired for 15 years. As I wind down my career, I've been thinking of taking a lump sum instead of a pension and then selecting a financial advisor. I have been talking to a couple of different advisors. Here are the assets. You ready Mark, 401k has $1.7 million. The wife had, I don't know what that number is. That looks like a small amount of money in her 401k. Like 8,080 grand. I'm not sure the lump sum is. Is this 920,000? I think so, yeah.

[Mark]

Yeah.

[Jill]

They've got $6,200 a month in Social Security payments, the emergency fund, 250 grand in high yield savings account. One of these advisors are saying, well, you can buy a buffered annuity, passive index, blah, blah, blah. And he says, I'm very leery of annuities. Annuities can lock you in for a long period. You lose control of your money. I agree with that. And bond exchange traded funds can lose money in a high interest period like we're in now, I need your advice. Which way should we turn? Should we stay with Vanguard, Invest on our own or go to this new advisor? Should we look for a truly independent third party? As a financial advisor, yes, that's usually what I like. Should we stay with a pension or take the lump sum? My pension is cut in half when I pass away. Ah. And it has no cola. Well, Mark, that's an interesting thing when you know the. It goes away. And he's already 70. So my inclination would be perhaps to take the pension in a lump sum, invest it in general, but I don't think I'd put it in an annuity. I would probably talk to a fee only financial advisor who could help you invest it, maybe even guide you, help you and your wife out. What do you think, Mark? I think that the idea that the pain pension is cut in half when he passes away and does not have a cost of living adjustment might change our thinking about normal. Like, oh, yeah, take the pension.

[Mark]

Right, yeah, that's a big variable. I think I'd rather get the nearly a million dollars, the full million dollars. I don't quite, you know, he doesn't say what they spend, so that's another question. But yeah, I'm leaning towards the lump sum.

[Jill]

Okay, so lump sum. And then I think you should seek the advice of a fee only independent financial advisor, somebody who could really analyze your situation and give you advice. I mean, listen, maybe an annuity could work if it were a low fee annuity. These are like becoming much more available in the marketplace. But I am leery as you are. So get in touch with somebody who can help you out. If you need just some more advice on this and you want to get back in touch with us. Of course, let us know. All right, that is it. That is the program. Thank you so much for listening. If you have a question, just go to jillonmoney.com click the contact us button. And of course, let us know if you'd like to come on the air. And if you want to come on the other show, which is called Money Moves, it is on YouTube and please follow us there. Please subscribe wherever you subscribe to this program. And yeah, let's spread the word. Don't forget that we have our free weekly newsletter. You can sign up for that right on our [e-mail] okay. We ask that you lift someone up. Change your work, change your wealth, change your life. Thank you for listening. We'll talk to you tomorrow. When a child faces a serious medical challenge, a children's hospital quickly becomes a family's entire world. Whether they're helping a child recover from a sudden injury or helping them manage a long term condition, these hospitals provide an irreplaceable community resource. Children's Miracle Network is dedicated to supporting this specialized care by securing the crucial funds these medical centers depend on daily. Children's Miracle Network is a leading charity impacting the health of all kids. They raise funds for 170 children's hospitals across the United States and Canada, protecting healthcare access for millions of families. Their fundraising network brings together corporate partners, local grassroots programs, and everyday donors like you and me. Your donation directly empowers your hometown hospital to use those resources exactly where they are needed most. Wherever you see the Children's Miracle Network balloon, you're helping a local child receive care. Visit cmn.org today to learn more and make a donation to your local children's hospital.

[Jen Hatmaker]

Hey, it's Jen Hatmaker. Here's what I've learned in midlife. Joy isn't the reward you earn after all the work is done. Joy is the work. That's what this new series on for the Love is all about. The sacred yes. It's choosing delight, rest and pleasure on purpose. Because saying yes to yourself, that's the thing that finally lets you fill your table with everybody else. Come find your sacred yes with me. Follow and listen to for the Love. Wherever you get your podcasts,