Should I file for early Social Security benefits at age 62?
Well it depends:
Full Social Security benefits are paid beginning at age 66 for those born between 1943 and 1954. Although Reduced Benefits will be paid to those as young as 62 who file for Social Security. Reduced benefits mean 7%-8% reduction for each year a person files early. Most people are advised to wait until full retirement to begin receiving benefits, and I agree. Of course there are exceptions. And it is those exceptions, I wish to discuss in this article.
An individual can coordinate benefits with a spouse. Couples should consider their circumstances and Social Security benefits jointly. For example, if the main bread winning spouse is much older or whose life expectancy will be short, it makes sense for the younger spouse to file for early Social Security. When the main bread winner dies the younger surviving spouse will receive the larger benefits received by the main bread winner. In the mean time for a few years she can at least enjoy some Social Security.
If an individual is seriously or terminally ill is the second reason to file for early Social Security benefits. The logic is obvious if your life expectancy at 62 is seriously limited it is better to receive benefits from a little Social Security than none when you are possibly not of this world at age 66. Seniors should not make hasty decisions based solely on their family history. Even if an individual’s parents died early, it should not be assumed one is destined for the same fate.
The third reason being when an individual has no money and very limited options to work for money. For seniors with limited financial resources, their filing early for Social Security may be a necessity rather than an option. Americans at age 62 who have been laid off, injured, or are without a steady source of income may find a reduced Social Security benefit is better than no money at all.