Claiming benefits at 62 reduces monthly payouts by up to 30%, a permanent cut compounded by annual cost-of-living adjustments.
Retirees who claim Social Security at 62 receive up to 30% less in monthly benefits, cutting a $2,521 payout to $1,335. The reduction persists through every cost-of-living adjustment, impacting lifetime income.
Full retirement age for those born in 1960 or later is 67, making a 62 claim five years early. While waiting increases cumulative benefits by around age 78, early filing may suit retirees with poor health or insufficient savings.
Households can optimize survivor benefits by having the lower-earning spouse claim early while the higher earner delays.