Bridge the gap Message. Recycled paper note pinned on cork board. Concept Image

According to retirement income specialist Alicia Munnell, those in the middle class who retire before 70 use their 401(k) assets first and defer receiving Social Security payments. This strategy is the “Social Security bridge” in retirement planning.

Building a bridge to Social Security are those who retire in their early or middle 60s are supposed to hold off on getting Social Security until they’re 70. So they get more money each month. In the years before they start to receive social security income, they can use their retirement savings to pay their bills. That is, if they are not working.

The “Social Security bridge” strategy is not one size fits everyone. This strategy has varying degrees of success depending on the conditions. According to Munnell’s research with the center for retirement research, she has outlined who should think about the bridge strategy and why.

Munnell speaks from experience. She’s a passionate defense and consistent voice for the view that the Social Security program has no financing crisis. There is no financing crisis that a few marginal benefit cuts and tax increases can’t solve.

Her research compares the advantages and disadvantages of using a bridge strategy. The funding for this strategy is taking money out of a retiree’s 401(k) plan, along with several other typical retirement income-generating strategies. At the same time, the retirees delay claiming social security income. 


Middle-class people who risk running out of money before they die should use the bridge strategy. In theory, they would spend as much money from savings each year between the retirement date and 70. As much as they would have earned from Social Security payments if they had claimed when they reached full retirement age.

Munnell concludes by contrasting multiple income strategies based on an intentionally simplified example. (i.e., 65 yr old single male with $100,000k in savings earning 3%.) 

She uses a variety of retirement income generating streams like an immediate income annuity or deferred income annuity with lifetime income. While only withdraws enough from qualified accounts each year to satisfy the RMD rules of the IRS, starting at age 72. Ideally, spending only enough from savings each month to match foregone Social Security benefits. 

The “bridge strategy” works better than buying a retail SPIA or DIA. Basing this assumption on the fact that Social Security, as an annuity, pays out more money than any life insurance company could pay. This strategy works best for those who are single with a savings of up to roughly $250,000.


When they reach retirement age, most Americans file for Social Security benefits, which makes sense. To begin, they suddenly need to replace earned income, and the government looks to be giving out free money. 

Second, a natural “liquidity preference” “will kick in that makes them conserve their own invested savings. Third, they suffer “survival pessimism.” They undervalue their life expectancy, which causes them to miscalculate the value of an annuity.

These shortcomings lead Munnell to suggest that 401(k) participants be defaulted (with an option to opt-out) into using systematic withdrawals from qualified savings to postpone claiming Social Security.


Deciding when to retire and when to collect benefits is a very personal and difficult choice. However, it is much more challenging when a person has no control over the circumstances. 

Some apps can simulate different Social Security deferral strategies to see when a retiree will “break even.” In the end, it is theory versus reality.

This strategy considers essential household expenses, eligible social security benefits, actual savings and growth, and knowing the legacy goals. These are all factors in deciding if this strategy works best for your client without jeopardizing the retiree’s quality of life.

For retirement planning, there are three most important dates for middle-class workers.

  • they stop earning,
  • the day they become debt-free,
  • the day they tap into Social Security.

The bridge to social security will be more accessible if the retiree is still working or debt-free with sizable savings.

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