Schweinsteiger made 28 outings for the Bundesliga champions last season, with injuries curtailing his progress under coach Pep Guardiola.
Speculative reports have since linked the 30-year-old with United. And while former Germany captain Lothar Matthaus believes Schweinsteiger should move to Old Trafford if the opportunity arises, Beckenbauer feels otherwise.
"Schweinsteiger does not need a challenge like that any more at his age," Beckenbauer told Sky Sport News.
"I would advise him not to make the move to England. He might as well stay here at Bayern.
"Schweinsteiger still has one or two more years at the highest level in him. If he still feels like playing football then, I would advise him to consider a move to MLS and to New York," concluded the honorary Bayern president.
Schweinsteiger has two years left on his contract with the Bavarians.