Wharton Pension Research Council Working Papers

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Working Paper

Date of this Version



This chapter argues that previous research on Social Security take-up alternatives has failed to recognize critical factors that greatly impact the discussion on when it is most beneficial to start Social Security retirement benefits. We show that the effect of taxes can have a dramatic effect on the financial security of retirees, yet the taxation caused by IRA withdrawals and the interaction with Social Security has been largely misunderstood. In addition, changes made under the Senior Citizens’ Freedom to Work Act of 2000 make delaying Social Security for married couples much more favorable. We also show how the traditional approach of starting Social Security benefits early and deriving income from stock and bond mutual funds is expected to under-perform a strategy that takes income from personal retirement assets first and is followed by increased benefits from Social Security.


The published version of this Working Paper may be found in the 2008 publication: Recalibrating Retirement Spending and Saving.


social security, retirement, Freedom to Work Act, financial security

Working Paper Number


Copyright/Permission Statement

All findings, interpretations, and conclusions of this paper represent the views of the authors and not those of the Wharton School or the Pension Research Council. © 2008 Pension Research Council of the Wharton School of the University of Pennsylvania. All rights reserved.

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Economics Commons



Date Posted: 17 December 2019