When it comes to your Social Security benefits, there's arguably no more critical decision than when you're going to claim them.
Many Americans choose to apply for Social Security at 62 -- the earliest age allowed. For those who retire early and need the income to live, that makes sense. But given that filing early means a reduction in your monthly benefits, it can be better to wait until you reach your full retirement age (which for anyone who hasn't claimed yet will be between 66 and 67). And for some people, delaying Social Security benefits until they're 70 works out best of all, because it offers them the chance to maximize the total amount they'll receive through the program over their lifetime.
The best age for you specifically to claim Social Security benefits depends on how long you're likely to live. And based on your family history and current health, you may have some guesses about that. But what you might not be factoring into your calculations is that major healthcare advances -- some that are on the way, and others that have already arrived -- could dramatically increase the lifespans of many individuals -- including yours.
Here's why the coming healthcare revolution should change your thinking about when you should claim Social Security benefits.
Taking aim at the leading causes of death
Statistically speaking, Americans today have a 23% chance of dying from heart disease and a 21.3% chance of dying from cancer, according to the latest available data from the Centers for Disease Control and Prevention (CDC). In 2017, nearly 1.25 million Americans died from those causes, up from a little over 1.23 million in the previous year.
While the numbers of Americans dying from heart disease and cancer are increasing, there's more to the story. As the U.S. population ages, there have been more overall deaths. But the percentages of deaths caused by both heart disease and cancer are slowly declining.
It's easy to overlook the tremendous progress that has been made in reducing our odds of dying from these top causes. Between 2006 and 2016, the U.S. death rate from cardiovascular disease decreased by 18.6%, according to the American Heart Association. The death rate from coronary heart disease plunged by 31.8% during that period. Between 1991 and 2016, the cancer death rate in the U.S. fell by 27%, according to the American Cancer Society.
Based on current trends, the CDC projects that cancer will overtake heart disease as the No. 1 cause of death for Americans by 2020. However, we're only in the early stages of a healthcare revolution that holds the promise of improving survival rates even more for both heart disease and cancer.
Leading the revolution
The percentage of Americans who smoke cigarettes has been steadily declining, which is one key factor underlying those falling death rates for heart disease and cancer. But medical advances have also played a major role. The great news is that more such advances are on the way.
Drugs that lower cholesterol and triglyceride levels -- such as statins like Crestor and Lipitor -- have been among the most important tools for preventing heart disease. New PCSK9 inhibitors Repatha and Praluent are even more effective at lowering cholesterol.
And later this year, the U.S. Food and Drug Administration is expected to make an approval decision on Amarin's Vascepa as a treatment for reducing heart risk. Vascepa could cut heart risk by as much as 25%, based on the results from a large-scale clinical study.
New medical devices also hold the potential to extend lives. The American Heart Association named Abbott Labs' MitraClip as one of the top heart disease and stroke advances of 2018. MitraClip helps repair leaky mitral valves, and has been found to significantly lower death rates and reduce hospitalizations in clinical studies.
Immunotherapies that harness the body's immune system to attack tumors have been game-changers in the treatment of cancer. And with nearly 450 new immunotherapies in development, there are likely many more advances on the way.
Probably the most exciting advance in oncology is the use of genetic research to better understand, treat, and prevent cancer. Many treatments under development target specific genetic mutations in cancer cells. Companies including Guardant Health have developed liquid biopsies -- blood tests that can identify DNA fragments that have broken off from tumor cells. These hold the potential to detect multiple types of cancer at early stages. The hope is that earlier diagnoses will lead to earlier and more effective treatment for cancer patients, which could save many lives.
The most audacious goal of all
There are plenty of other innovative healthcare initiatives underway that could reduce the number of deaths from heart disease and cancer. And there are many new drugs and medical devices that are likely to radically improve the prevention and treatment of other common causes of death as well. But Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL) subsidiary Calico has embarked on the most audacious quest of all: Extending the human lifespan in general.
You might think such an idea sounds ridiculous. However, the Calico team takes its mission seriously. CEO Arthur Levinson led pioneering biotech Genentech from 1995 until 2009, when it was acquired by Roche. Calico has also partnered with AbbVie, a leader in the biopharmaceutical industry.
Calico is researching the underlying reasons why people grow less healthy as we age. For example, it's exploring the genetics of the naked mole-rat, which has an unusually long lifespan for an animal of its size, and grows old with few signs of aging. And it's working with AncestryDNA to evaluate anonymized data from millions of family trees and genetic samples to try to determine the role of genetics in families with unusual longevity.
To be sure, Calico has a long way to go to achieve its goals. But it's not out of the realm of possibility that the Alphabet subsidiary could help develop therapeutics that lengthen the lives of many people who today aren't expecting to live much past age 80.
Rethinking your Social Security strategy
If you're planning your strategy about when to claim Social Security based on how long your parents or grandparents lived, you probably need to rethink it. The reality is that they didn't have access to many of the medical advances that are available today. And the technologies under development appear even more promising.
Once you begin receiving Social Security benefits, you're essentially locked into the payment level you've picked. (Admittedly, there is a 12-month window after you file during which you can change your mind and withdraw your claim so you can refile later. But that loophole won't help most long-lived retirees.)
Most retirement experts will tell you that the Social Security system is designed so that, on average, it really shouldn't matter what age you start collecting your benefits. If you file earlier, you'll get smaller payments, but more of them. File later, and you get larger payments, but fewer of them. The numbers are calibrated so that, if you live to an average age, you'll get about the same amount of money in total out of the program, regardless of when you apply.
But that's an average age based on what the actuaries expect today. Factor in the potential for the coming healthcare revolution to extend our lives, and it becomes clear why holding off to claim Social Security at least until your full retirement age -- or even waiting until age 70 -- is increasingly likely to be the better financial choice.
You just might live a lot longer than you think, and if you do, you'll have many years to appreciate your larger monthly benefit payments. And don't worry -- Social Security will still be there if you wait.