Social Security: Why Is It Bad Starting at Age 62?



Social Security is a key program that provides retirement benefits to millions of Americans; and knowing the ideal time to start it and the factors to be considered are very instrumental to having the best of it. For many people, the decision of when to start taking Social Security benefits is a difficult one. Some people choose to start receiving benefits as soon as they turn 62, while others wait until they reach full retirement age (70). 

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In this piece, we explain why it is bad to start social security at age 62, and the fundamental things to look out for.

5 Reasons Why Taking Social Security at Age 62 is Bad

Applying for Social Security benefits at age 62 may seem tempting, especially if you are looking for a way to supplement your income during retirement. However, below are the reasons why this may not be the best option:

  • Reduction of Benefits: One of the most significant drawbacks of taking Social Security benefits at age 62 is that you will receive a reduced benefit amount. 

If you start taking benefits at 62, your monthly benefit will be reduced by around 30% compared to what you would receive at full retirement age. This reduction is permanent and will continue for the rest of your life, which can lead to a significant loss of income over time.

  • Longer Retirement: Another reason why taking Social Security benefits at age 62 is a bad idea is that many people are living longer and healthier lives than ever before. 

If you expect to live a long time, delaying Social Security benefits can increase your monthly benefit amount and provide more financial security throughout your retirement years.

  • Social Security Earnings Test: If you continue working while receiving Social Security benefits at age 62, you may be subject to the Social Security earnings test. 

As a result, your benefits will be reduced by $1 for every $2 you earn over a certain limit (which was $18,960 in 2021). This can lead to a significant reduction in benefits or even no benefits at all if you earn too much.

  • Higher Taxes: Social Security benefits are subject to income taxes if your income exceeds certain thresholds. 

If you take Social Security benefits at age 62 and continue working, your income may push you over these thresholds, resulting in higher taxes and lower net income.

  • Limited Financial Flexibility: Social Security benefits at age 62 can hinder your financial flexibility. If you need to access more money in the future, you may not have the ability to increase your Social Security benefits. 

Key Factors to Consider when choosing Social Security

Reckoning with the relevant factors in the course of choosing social security is key to taking the right decision. These factors include:

  • Full Retirement Age: Your full retirement age (FRA) is the age at which you can start receiving your full Social Security benefits. It is important to know it because if you start taking benefits before your FRA, your benefits will be reduced, and if you wait until after your FRA, your benefits will increase.
  • Health: Your health condition and life expectancy are important factors to consider when choosing when to start receiving Social Security benefits. 

If you’re in good health and hope to live a long time, delaying benefits may be a smart decision since your monthly benefit amount will increase the longer you wait.

  • Financial Needs: Your financial situation is another key factor to consider. If you need income as soon as possible, starting to receive Social Security benefits at age 62 may be the best option for you. 

However, if you have other sources of retirement income or can wait a few years, delaying benefits may result in a higher monthly benefit amount in the long run.

  • Work Plans: If you plan to work during your retirement years, you should consider how this will affect your Social Security benefits. If you start taking benefits before your FRA and continue to work, your benefits may be reduced or even eliminated due to the Social Security earnings test.
  • Spouse’s Retirement Plans: If you’re married, you should also consider your spouse’s retirement plans when choosing when to start receiving Social Security benefits. 

For instance, if your spouse has a higher benefit amount and you expect to live a long time, it may make sense to delay your benefits to maximize your joint benefits in the long run.

What Is the Best Age to Take Up Social Security?

The ideal recommended age for Social Security benefits cannot be explicitly stated because it depends on a number of factors including your financial needs, health status, and retirement goals. 

The earliest you can start receiving Social Security benefits is age 62, but taking benefits at this age will result in a reduced benefit amount for the rest of your life. 

While there is no one-size-fits-all best age, it is often advisable to delay commencing social security programs because if you delay taking benefits, your monthly benefit will increase, up to a maximum at age 70.

CAVEAT: It is important to consult an expert on the medicare program in order to know the ideal time to start taking social security depending on your socio-economic conditions.

Learn More

Are you seeking a Medicare expert that can provide authoritative advice on the best time for starting social security? Then, you need not stress yourself. MedicareOnVideo is here for you. 

We are available 24/7 for your inquiries. You can acquire first-hand information by watching our Medicare series on “Why I Would Never Take Social Security at Age 62. Bad Idea!”

You can contact us directly at 1-877-855-3484. Willing to know more about the A-Z of Medicare, get our Medicare ebook – Medicare Made CLEAR, which contains relevant content, links, and videos on all Medicare areas of coverage.

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