Top Reason to Take Social Security at 62

Understanding the Decision to Claim Social Security at 62

Claiming Social Security benefits at age 62 is a common choice for many Americans, but it's not always the best option. While waiting to claim can lead to larger monthly payments, there are several factors that may make starting at 62 the right decision for some individuals. Understanding these reasons can help people make informed choices about their retirement.

Motivated by Necessity

One of the most common reasons people choose to claim Social Security early is due to financial necessity. Life circumstances such as job loss, health issues, or unexpected expenses can push individuals to take their benefits earlier than planned. For many, this decision isn’t ideal, but it’s often the most practical given their situation. The pressure to cover basic living costs can make it difficult to wait for higher payments, even if it means receiving less over time.

Planning for a Long Retirement

For those who expect to live a long life, claiming Social Security at 62 might be beneficial. According to the Census Bureau, the average life expectancy for a man aged 62 is around 19.61 years, while for a woman, it's approximately 22.50 years. If you come from a family with a history of longevity or maintain good health, you might prefer to start receiving benefits sooner rather than later. This allows you to enjoy more years of retirement income, even if the amount is smaller than what you could receive by waiting.

Considering a Shorter Retirement

On the flip side, if you have serious health concerns and don't expect to live a long life, taking Social Security benefits early could be a better option. This way, you can use the money to enjoy the remaining years of your life without the burden of work. It's important to consider healthcare costs, as Medicare eligibility begins three months before your 65th birthday. Make sure you have an alternative source of health insurance in place, especially if you're married and your spouse plans to continue working.

Jobs That Take a Physical Toll

Many older workers have physically demanding jobs that can be hard on the body. A report by the Economic Policy Institute found that nearly half of workers aged 50 to 70 have jobs that are physically taxing or involve hazardous conditions. For these individuals, retiring early can provide much-needed relief. Whether you have savings to support your retirement or plan to take on a less strenuous job, prioritizing your health is essential.

Supplemental Income Sources

If you have other sources of income, such as pensions, annuities, stock dividends, or part-time work, you may be able to retire earlier without relying solely on Social Security. The average monthly Social Security benefit is around $2,000, which totals about $24,000 annually. Having additional income streams can make it easier to manage expenses and reduce the need to wait for larger payments.

Feeling a Sense of Ownership

According to the Center for Retirement Research at Boston College, many workers feel a strong sense of ownership over their Social Security benefits after decades of payroll taxes being deducted from their paychecks. This sense of entitlement can make them eager to claim what they believe is rightfully theirs. Concerns about potential future cuts to benefits also play a role in this decision.

Making the Right Choice

Deciding when to claim Social Security is a personal choice that depends on individual circumstances. It's important to evaluate your expected income sources and post-retirement expenses to determine if retiring at 62 is feasible. While there are clear advantages and disadvantages to claiming early, the final decision should reflect your unique financial and personal situation.

By considering all these factors, you can make a well-informed choice that aligns with your goals and needs. Whether you decide to claim at 62 or wait for larger payments, understanding the implications of your decision is key to a secure and fulfilling retirement.