Key Points
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Seniors are doing something different with Social Security this year.
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More people are claiming their benefits early compared with in 2024.
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However, this choice could end up being a mistake for many seniors.
Seniors are doing something different this year when it comes to Social Security than they have in the past. According to an analysis of Social Security Administration data conducted by the Urban Institute, more Americans are filing early for their retirement payments in 2025 compared with 2024.
Specifically, the Urban Institute found that retirement claims were up by over 276,000 between October and April compared with the prior year, and more retirees were starting to collect benefits at younger ages. There was an especially big increase among retirees who were just 62 years old and claiming benefits.
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It’s not exactly clear why people are claiming at younger ages, although the Urban Institute suggested that increased fear and uncertainty about changes to Social Security could be a driving factor.
Regardless, though, this trend is not a great one, and it could spell trouble for some early claimers down the line.
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Why this is a troubling Social Security trend
The fact that more people are claiming Social Security benefits early is not great news, because an early claim can result in a significant reduction in monthly benefits.
That’s especially true if you are claiming Social Security at 62. That’s well before your full retirement age and the earliest possible age that you can claim retirement benefits. An early claim shrinks the money you have coming in, and by a substantial amount. If your FRA is 67, you will end up with a 30% reduction in monthly benefits compared to your standard benefit.
With a growing number of seniors giving into the temptation to claim at 62, many are likely to find themselves accepting this big cut, which can also shrink survivor benefits that are left behind for a lower-earning spouse.
Since so many people have too little invested in retirement plans, accepting a reduced Social Security could lead to serious financial hardship. This could be an especially big problem later in retirement if the funds in your 401(k) start running out and you’re left with only a small check to make ends meet.
Worse, evidence shows that around 7 in 10 retirees end up collecting more lifetime income if they delay their benefits claim, as Social Security’s system of early filing penalties and delayed retirement credits was created when life expectancies were shorter.
This means the growing number of retirees who are claiming their benefits early could be cheating themselves out of some lifetime income by doing so.
Should you claim Social Security early?
Now, there are some times when claiming Social Security early makes good sense.
If you’ve had to retire early and can’t live without Social Security unless you take too much out of your 401(k) or IRA too fast, then you are better off with an early claim rather than draining your accounts and being forced to try to live on Social Security alone later in life.
If you’re in poor health and don’t have a spouse who’s going to rely on survivor benefits, an early claim could also make sense. You might not live long enough to break even if you delay.
Likewise, if you plan to claim spousal benefits later on, you may want to claim your own retirement benefits early to have some Social Security income coming into your household. In this case, the benefit cuts for an early claim won’t matter since you’ll be switching to spousal benefits later anyway.
However, the key is to make an informed choice. Don’t act out of panic or fear when making your claiming choice. Carefully consider the impact of both an early and a late claim on your monthly checks and total lifetime benefits and make the decision that’s right for you.
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