The Real Cost of Claiming Social Security at 62

Age 62 is the first year most people can file, and for that reason it is the year most people do file. The trade is permanent: if your full retirement age is 67, filing at 62 locks in roughly 70% of the benefit you earned. That is close to a 30% reduction, and it does not correct itself when you reach 67.

The reduction is not a flat haircut either. Social Security reduces your benefit by 5/9 of 1% for each of the first 36 months you file early, then 5/12 of 1% for every month beyond that. Because cost-of-living adjustments are applied to the reduced figure, the gap between an early check and a delayed check widens every year you live.

That does not make 62 wrong. If you have left work involuntarily, if your health history is short, or if drawing benefits early lets your invested accounts keep compounding, early filing can be the better plan. What makes it wrong is filing at 62 because it was the first door that opened.

The number worth calculating before you decide is your break-even, adjusted for your household rather than a national average. Compare the total you would collect by filing early against the total from waiting, then ask which of those two numbers your spouse would inherit as a survivor benefit. Couples almost always find the answer sits with the higher earner's record.

Bring your most recent Social Security statement, your pension estimate if you have one, and your account balances. With those three documents the decision stops being a guess and becomes arithmetic.