Key Points
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Claiming Social Security early may result in a smaller monthly benefit.
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Your annual COLAs will be smaller in terms of dollar value.
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If you’re still working, you could lose more of your checks to the earnings test.
If anyone’s ever cautioned you not to claim Social Security at 62, they’ve probably focused on how it can permanently reduce your monthly checks by up to 30%. This is a valid concern, especially if you plan to rely heavily on your checks in retirement.
But it’s not the only way early claiming can come back to bite you. Before you decide to apply at 62, make sure you’re comfortable with the following three trade-offs.
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1. You may get a smaller lifetime benefit
In addition to smaller monthly checks, you may have to settle for a reduced lifetime benefit if you claim Social Security at 62. This is pretty common if you expect to live into your mid-80s or beyond. However, those with short life expectancies may not face this particular drawback.
A smaller lifetime benefit means you’ll have to rely more heavily on personal savings to cover your retirement costs. If you don’t have a lot of savings, you may need to fall back on a job or other government benefits to pay for your expenses.
2. You’ll get smaller cost-of-living adjustments (COLAs)
Social Security cost-of-living adjustments (COLAs) are percentages, so the dollar amount you receive depends on the size of your current benefit. The larger your checks are today, the larger your future COLAs will be.
If you have a reduced benefit because you applied for Social Security at 62, you’ll get smaller benefit boosts each year. And if the COLAs aren’t enough to keep pace with inflation, you may find yourself leaning even more on personal savings.
3. You’ll be at risk of the earnings test if you’re still working
Early claimers who remain in the workforce risk losing more of their benefits to the earnings test. This withholds $1 from your checks for every $2 you earn over $24,480 in 2026 if you’ll be under your full retirement age (FRA) for the entire year. FRA is 67 for most workers today. If you’ll reach your FRA in 2026, you only lose $1 for every $3 you earn over $65,160, but only if you earn this amount before your birth month.
Fortunately, money lost to the earnings test doesn’t disappear for good. You’ll get it back as a permanent benefit boost once you reach your FRA. But it could force you to fall back on your income from your job to cover more of your expenses in the near term.
If any of these things surprised you, you may want to rethink claiming Social Security at 62. Waiting a few years will permanently increase your checks and could make retirement much more comfortable.
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