What's the Early Retirement Age for Social Security?

Assuming you qualify for Social Security benefits, you can take them as soon as the first full month after your 62nd birthday.

Aug 15, 2014 at 11:00AM

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There are few things most people look forward to more than retirement. It's for this reason that readers are often interested in knowing what the early retirement age is for purposes of Social Security.

The earliest possible age at which you can begin to collect Social Security retirement benefits is 62 -- or, more specifically, the first full month following your 62nd birthday.

Should you take Social Security early?

The fact that you're eligible to begin collecting benefits at 62 doesn't necessarily mean that you should. I say this because the size of your monthly checks is directly related to the age at which you elect to receive them.

The standard threshold for our purposes is your primary insurance amount. This is how much you'd receive each month if you waited until full retirement age -- which, at present, is 66 years old -- to start collecting benefits.

If you apply for Social Security earlier than that, then your benefits are permanently reduced by a set percentage each month prior to full retirement.

For example, if you take them at 62, then they will forevermore be 25% smaller than your primary insurance amount. By contrast, if you defer benefits beyond full retirement, then they grow in size by 8% each year until you turn 70, at which point they're maxed out.

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The net result is that, if you're focused exclusively on maximizing the size of your monthly checks, then it would behoove you to hold out for as long as possible (but no later than age 70) before applying for benefits.

Is bigger necessarily better?

That being said -- and this is an important point -- the fact that delaying benefits will make them bigger doesn't necessarily mean you'll end up receiving a bigger total amount by waiting.

This is because the Social Security Administration has designed the benefit formula to yield the same amount in aggregate lifetime benefits regardless of the age at which the average American takes them.

If you take benefits at the early retirement age of 62, then the checks will be smaller, but you'll get more of them. Meanwhile, if you wait until 70, you'll get far fewer checks, but they'll be substantially larger.

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The breakeven point -- that is, the age at which you will have received the same total amount whether you claimed benefits at 62 or 67 -- is age 77. Before that age, the typical Social Security beneficiary receives more in lifetime benefits by electing to take them early. But after that age, the retiree who delays benefits pulls further and further ahead thanks to those larger monthly checks.

The bottom line on the early retirement age

At the end of the day, the decision regarding when to take Social Security benefits boils down to need and quality of life. If you need them, take them. If you don't need them, and you expect to live out a long retirement, there's little reason not to let them grow. That said, you may decide that even though you don't need to take benefits early, you'd like to enjoy that extra income sooner rather than later. There's no one-size-fits-all solution -- it all comes down to what you feel is best for you.

How to get even more income during retirement
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