The No. 1 Reason to Claim Social Security at Age 62

The No. 1 Reason To Claim Social Security At Age 62

One of the nicest features of Social Security is that seniors can choose when to claim benefits. Granted, you won’t get your full monthly benefit based on your personal wage history until you reach full retirement age, or FRA, which is either 66, 67, or somewhere in between. But if you don’t want to wait that long, you can file for benefits as early as age 62.

Of course, the main drawback of going this route is slashing your monthly benefits for life. And if you don’t have much in the way of retirement savings, you may want to lock in a higher benefit. But while claiming Social Security at age 62 could backfire in some cases, here’s a great reason to snag your benefits as soon as you’re entitled to them.

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How much risk do you want to take on?

While it’s true that claiming Social Security at age 62 will result in a lower monthly benefit, it could actually lead to a higher lifetime benefit. And if you don’t want to bear the risk of not living long enough to make waiting to file worth it, then you may want to sign up as soon as you’re eligible.

Let’s imagine you’re entitled to a monthly Social Security benefit of $1,600 at FRA. Filing at age 62 will shrink that benefit to $1,120 if your FRA is 67. If you wind up living until age 81, you’ll end up with $13,440 less in total Social Security income by virtue of signing up for benefits at 62.

But will you end up living until age 81? It’s hard to say, right?

Even if your health is great in your early 60s, you never know when things might take a turn for the worse. You could fall ill and end up passing away in your early 70s for all you know. And while it’s good to be optimistic and hope that doesn’t happen, and it’s equally good to take steps to maintain your good health, the reality is that some things are just out of your control.

That’s why you may want to move forward with a Social Security claim at age 62. Doing so could give you peace of mind knowing you’re not taking the risk of getting shorted on benefits in the event of a fairly young passing.

In fact, going back to our example, let’s imagine you claim benefits at 62 but only live 10 more years after that. In that case, you’ll come out $38,400 ahead in lifetime Social Security income by virtue of signing up for benefits as early as possible.

What’s the right call?

Contemplating your own mortality can be a very difficult and uncomfortable thing. But seniors are commonly advised to think about how long they’re likely to live in the course of choosing a Social Security filing age.

That’s not bad advice, but it’s also advice that’s not so easy to act on. And so if you’d rather limit your risk of getting shortchanged on Social Security income in your lifetime, then it could pay to file for benefits the moment you’re eligible to sign up.

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