3 Reasons Not to Claim Social Security at 62

Age 62 is a fairly common age for Americans to retire. And part of the reason is that 62 is the earliest age to sign up for Social Security.

But that doesn’t make 62 the best age to claim Social Security. And the reason is that if you don’t wait until full retirement age (FRA) to file, your monthly benefits will be permanently reduced.

FRA doesn’t kick in until age 67 for people born in 1960 or later, though. So if you’re in that boat and you claim Social Security at 62, you can expect your monthly benefits to be reduced by about 30% — for life.

That’s the obvious reason not to sign up for Social Security at the earliest age possible. But here are a few additional reasons not to claim Social Security at 62.

1. You’ll lose out on income if you live a long life

You might think that claiming Social Security early will work to your advantage in terms of lifetime income. After all, you’ll be getting those benefits five years sooner than waiting until FRA (assuming yours is 67).

But filing early will only result in more lifetime Social Security income if you don’t end up living such a long life. And on the flipside, if you do live a long life, then claiming benefits at 62 will generally result in less total income from Social Security.

2. You may need to spend more than expected on healthcare

You may decide that you’re okay to claim Social Security at 62 and reduce your monthly benefits after setting up a retirement budget that accounts for your various costs. But one expense you may be underestimating is healthcare.

Fidelity says that the average 65-year-old can expect to spend $165,000 on healthcare expenses during retirement. But what if you’re not someone with average health?

If you have a lot of issues, your total health spending tab could end up coming in much higher. And so the less money you get from Social Security each month, the harder it becomes to keep up with expensive healthcare bills.

3. You may want more options to keep busy

A funny thing tends to happen to people once they retire. Rather than find themselves enjoying their newfound free time, a large number of seniors end up bored and unhappy.

Part of that is the absence of a daily job. But if you lack funds for leisure, boredom could stem from having limited choices for occupying your time.

That’s another danger in claiming Social Security at 62. If you slash your benefits, you’ll have that much less money available to spend on entertainment.

And also, having limited funds to go out and do things could lead to you becoming isolated. Imagine your retired friends have the money to take day trips and go to the theater, but you don’t because you’re getting a reduced Social Security benefit. That’s not a great situation to be in. So before you claim Social Security at 62, think about how doing so might ultimately impact your social life.

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