Retirees often rely on Social Security income to help them pay the bills after paychecks have stopped. The amount of money Social Security provides can vary based on many factors, including how much you earned during your working life. Your age when you start benefits also has a profound influence on what you earn.
The youngest you can start benefits is age 62, so let's take a look at how much money the average 62-year-old has received so far in 2024 from the Social Security Administration.
Image source: Getty Images.
This is the income the youngest retirees have received so far this year
According to data from the Social Security Administration, the average monthly benefit that 62-year-old retirees received as of the end of December 2023 was $1,298.26. A Social Security cost-of-living adjustment (COLA) of 3.2% went into effect in January, increasing benefits. This means that the size of the average check received by 62-year-old retirees in 2024 comes in at $1,339.80 per month.
For 62-year-old retirees who started receiving Social Security checks in January and who received the average benefit from January to July, the average amount these young retirees received was $9,378.60.
Of course, benefits don't begin until you claim them at 62, so if you didn't reach that milestone until after the start of the year, your benefits received to date will likely be lower. On the other hand, some higher earners will beat the average benefit, so their Social Security income so far this year will be higher.
The important thing to know, though, is that the typical 62-year-old Social Security recipient is not really getting very much money at all. A benefit of $1,339.80 per month, or $9,378.60 in total when more than half the year is done, is not a very impressive amount of money. It's also far lower than the overall average benefit of $1,917 per month.
Why do 62-year-olds get so little retirement income from Social Security?
It may be shocking to see how little the typical young retiree earns in Social Security benefits. But there are good reasons why this group of seniors isn't receiving much money.
The biggest issue is that a Social Security claim at 62 is always going to be an early claim. That's because retirees have a full retirement age, or FRA, as late as 67 depending on birth year. FRA is well after 62, and when you claim benefits before FRA, your checks shrink. You are hit with early filing penalties that reduce your benefit by 5/9 of 1% for the first 36 months and 5/12 of 1% any prior month.
These penalties combine to reduce benefits by 6.7% for each of the first three years you claim early and 5% before that. The reduction is substantial, which explains why those who are already getting benefits at 62 -- and who have thus accepted early filing penalties -- see much less income each month than those who delayed.
Now, you may have to claim Social Security at a young age for a variety of reasons, such as wanting to retire early, getting pushed out of your job and not being able to find another one, or needing the income. But, before you do, pay attention to how little it provides the typical retiree and to the penalties you'll face for early retirement.
You may just decide you'd rather delay for longer to get more money each month from this guaranteed income source.
