Many seniors are inspired to claim Social Security at age 62 for one big reason -- they can. In other words, age 62 is the earliest age to file for benefits. And while signing up at that point means accepting a reduced monthly benefit for life, for many seniors, that hit is worth it.
If you're contemplating a Social Security filing at age 62, you might feel similarly. And it's easy to see why claiming benefits that early is appealing. If you're tired of working, signing up for benefits at age 62 could be your ticket to the early retirement you've always dreamed of.
Plus, you may want the peace of mind that comes with getting your money earlier. Nobody knows how long they'll live. But if you claim Social Security at 62 and don't wind up with a very long lifespan, you'll generally come out ahead financially compared to filing at a later age.
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Yet despite the perks of claiming Social Security at 62, you might end up regretting that move big-time afterward. And if you realize your mistake years after the fact, it'll be too late to correct it.
You need protection from rising living costs
In the months leading up to your Social Security filing, you might map out a retirement budget that a lower monthly benefit can support. But the expenses you account for at that stage of life could very much differ from the expenses you wind up incurring years down the line.
First of all, inflation could drive the cost of living way up, as it's already done this year. Secondly, as you age, you might incur added costs you didn't think about earlier.
You might end up spending a lot more on healthcare. And if you become less mobile later in life, you might need to pay for more help -- think things like meal delivery services and ride-shares to get you where you need to go.
And therein lies the danger of claiming Social Security at age 62. You might think you'll be OK with a lower monthly benefit, only to find years later that you could use a higher monthly paycheck on an ongoing basis.
If you file early, you can undo your mistake
If you haven't yet claimed Social Security but are thinking of doing so at 62, consider this your wakeup call to rethink that decision -- or at least make quite sure you understand the risks involved. Meanwhile, if you've already signed up for Social Security at 62 and are now realizing that may have been the wrong move, don't panic. If your filing was recent, you may be able to undo it.
Social Security gives every filer one do-over in their lifetime. If you signed up for benefits at 62 but regret that already, you can withdraw your benefits application and repay all of the money you've received to date. Do so within a year of your claim, and you'll be all set to file again at a later age.
There are certainly plenty of good reasons to sign up for Social Security at age 62. Just make sure you also understand why doing so could end up being a glaringly bad idea.
