Why You Probably Shouldn’t Claim Social Security At 62, Even Though You Can

Social Security. The older you get, the more you have to think about it and consider the possibilities of taking it earlier or later in life.

According to Yahoo Finance, there may be benefits to taking Social Security by the age of 62, but there are negatives to claiming it too early. Many factors play into when the right time is to take Social Security, and you can’t just rely on the statistics. You need to rely on the contributing factors in your life, as well.

There are three major things one must consider when that time of your life begins creeping up on you, the very first one being a miscalculation of your life expectancy. It is recommended to have a higher life expectancy, which is understandable (considering you’ve already made it to the age of 62).

That Social Security figure is more than 20 years, which brings you to 82. By claiming Social Security too early, you run the risk of lost checks, so it’s best to endure the higher monthly payments from waiting longer versus the lost checks that early claimers may experience. It will pay off in the long run for those who wait to claim.

The second contributing factor is overlooking your spouse’s needs. If you’re single, you have no problem — it’s really all up to your personal finances at that point. Say you’re married, something happens, and you pass away. You’re the primary earner of the family. That means your spouse is automatically entitled to survivor benefits. Claiming early reduces the survivor payment for your spouse, and therefore, and deprives your family of the finances they could have received if they had waited to claim.

The third and final contributing factor is the misunderstanding of the Social Security forfeiter rules. The rules for Social Security in general can be tough to follow, and require a lot of independent research when the time gets closer. Essentially, if you don’t reach your full retirement age in the full year and you’re still working, and you claim your Social Security during that time, you will need to forfeit your Social Security.

Yahoo Finance states, “For every month’s worth of benefits you lose, you’ll be treated as if you’d claimed Social Security one month later than you actually did. If you earn enough that you forfeit everything you get from Social Security that year, you’ll be treated as if you’d retired a full year earlier.” They follow up by saying, “Once you’ve reached that age, you can stay at your job and earn as much as you want and still keep your Social Security.”

Social Security is tricky to follow and even more difficult to process when the time eventually comes to claim. Fear not; just remember to do your homework and use your best judgment in making Social Security decisions, not only for yourself, but also for your spouse and family.

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[H/T: Yahoo Finance]