A 64-Year-Old Couple Ran the Numbers on Claiming Social Security Early and Spending the 401(k) Later. They Had It Backwards.

The pitch sounded reasonable at the kitchen table. Claim Social Security now at 64, let the 401(k) keep compounding, and tap the portfolio in the late 70s and 80s when spending needs are higher. A recent Investopedia piece noted how few retirees actually wait as long as possible to claim benefits. This couple was about to join that majority. The math argues they should flip the plan entirely.

Assume a $1.4 million 401(k), both spouses turning 64, and Social Security primary insurance amounts of roughly $2,900 and $1,900 per month at full retirement age. Claiming early permanently reduces those checks. Waiting until 70 does the opposite, and the compounding effect is larger than most people realize once the annual cost-of-living adjustment is layered on top.

Why Delaying the Check Beats Delaying the Withdrawal

Delayed retirement credits add roughly 8% per year between full retirement age and 70. That increase then compounds against every future COLA. The Social Security Administration officially announced the 2027 COLA at 3.6%, calculated from CPI-W readings of 327.104 in July, 328.481 in August, and 330.654 in September 2026. A COLA applied to a benefit worth roughly 76% more at 70 than at 62 puts more real dollars in the mailbox every year for the rest of both lives and, critically, for the survivor.

The 401(k) does not need to match that. It needs to bridge six years of spending. Average annual household expenditures were $78,535 in 2024, and most 64-year-old couples in this asset range spend more. Pulling $90,000 to $110,000 per year from the 401(k) between 64 and 70 leaves the portfolio bruised but intact, while the higher lifetime Social Security stream more than compensates over the long run.

Bridge Years Are a Tax Planning Gift

Between ages 64 and 70, with no Social Security coming in and no wages, taxable income drops to whatever the couple pulls from the 401(k). The 2026 married filing jointly brackets run 10% to $24,800, 12% to $100,800, and 22% to $211,400, against a standard deduction of $32,200. A $110,000 gross withdrawal nets to roughly $77,800 of taxable income after the standard deduction, sitting comfortably inside the 12% band with room to spare.

That runway opens the door to Roth conversions at bargain rates. Every dollar converted now is a dollar that will not inflate an RMD at 73, will not push provisional income past the 85% Social Security taxation threshold, and will not count toward the IRMAA lookback that governs Medicare Part B and D premiums two years ahead. The alternative sequence, leaving the 401(k) untouched while Social Security flows in, stacks ordinary income on top of taxable benefits, and marginal rates that approached 12% can balloon toward 40% once RMDs and IRMAA surcharges arrive simultaneously.

Where to Park the Bridge Cash

Money earmarked for the next 12 to 24 months of withdrawals belongs in something predictable. The FDIC national average 12-month CD sits at 1.73%, but shelf rates run materially higher. Short Treasuries are the cleaner instrument for this purpose: the 6-month is yielding around 4.34% and the 1-year around 4.48% as of mid-October 2026, well above what most banks post on standard CDs. A simple ladder of 6-month and 1-year Treasuries funds the bridge without market risk and keeps the remaining 401(k) balance fully invested in growth assets during the delay window.

Three Moves to Make Before Year-End

1. Model the delay-to-70 scenario against a claim-now scenario using your actual SSA statement. Include survivor benefits. The higher earner’s decision sets the floor for whichever spouse lives longer, and that single factor alone often reverses the intuition to claim early.
2. Fill the 12% bracket with Roth conversions every year from 64 to 72. If ordinary withdrawals total $110,000, gross income after the $32,200 standard deduction sits near $77,800, leaving room to convert additional traditional 401(k) or rollover IRA dollars before crossing into the 22% bracket at $100,800 of taxable income. Stop short of the first IRMAA tier once Medicare enrollment approaches.
3. Build a two-year cash bridge with short Treasuries. Locking in approximately 4.34% on the 6-month and 4.48% on the 1-year removes sequence-of-returns risk from the exact years the 401(k) is doing the heavy lifting.

The couple who claims at 64 and preserves the 401(k) locks in a smaller benefit for life and walks into RMDs with a fully loaded pretax account. The couple who spends the 401(k) first and waits on Social Security ends up with a smaller taxable balance, a larger inflation-adjusted government check, and a stronger position for the surviving spouse. Same assets, opposite outcomes.

Editor’s note: This article has been updated to reflect the SSA’s official 2027 COLA announcement of 3.6% (up from the earlier projection of 3.3%), the 2026 married filing jointly tax brackets and $32,200 standard deduction, an updated FDIC national average 12-month CD rate of 1.73%, and current mid-October 2026 Treasury yields of approximately 4.34% on the 6-month and 4.48% on the 1-year.

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