Reason no. 1 to claim Social Security benefits at age 62

Life is full of important decisions. Where to go to school. What job should I take? Who to marry. Where to live. These are just a few of them.

As you approach your retirement years, another important decision comes to the fore: When should you start collecting Social Security? For many Americans, the answer is age 62 — the earliest possible date.

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Reasons to collect Social Security at age 62

There are several reasons to start collecting Social Security benefits at age 62. Let’s start, though, with some not-so-good reasons.

The Schroders 2024 US Retirement Survey found that 12% of respondents planned to claim Social Security before full retirement age (FRA) because they were advised to do so. But advice given without a full assessment of the financial impact on the individual would not be a good reason to claim Social Security early.

Thirty-eight percent of survey respondents were worried that Social Security would run out of money, so they planned to claim benefits as soon as possible. While it’s true that if nothing is done, Social Security’s trust funds will run out by 2035, the program could still pay about 83 percent of benefits after that time because of ongoing tax receipts. More importantly, Congress will likely make reforms to shore up Social Security before then — because politicians like to get re-elected, and making sure retirees get their checks is a popular move.

A better reason to claim Social Security at age 62 is because of poor health, which is likely to shorten your life expectancy. If your health is such that you don’t expect to live past the break-even age (when the total benefits received from claiming at a later age exceed the total benefits received from claiming at an earlier age), collecting Social Security at 62 years might make sense.

Another good reason to apply for Social Security at age 62 is if you are facing financial difficulties and need money. For example, if you lose your job at age 62 and can’t find another, receiving Social Security benefits could help you make ends meet. Thirty-nine percent of respondents to the Schroders survey planned to claim Social Security early because they needed the money.

Reason no. 1

You may have noticed that there was at least a hint of negativity with all of the above reasons for claiming Social Security at age 62. Probably ill-informed advice. Pessimism about the future of the program. Health problems. Financial problems.

Is there a positive reason to collect benefits at age 62? I think so. In my opinion, reason no. 1 to claim Social Security at age 62 is whether it will allow you to achieve what you want in retirement.

For example, you don’t have to be in poor health to want to travel as much as possible after retirement while you still can. Collecting Social Security benefits earlier than FRA can help you afford your dream vacations.

Or maybe you just don’t like your job and are ready to work. For some, claiming Social Security at age 62 allows them to leave a job they hate and instead enjoy the hobbies they love.

Trade-offs to consider

If you’re thinking about claiming Social Security at age 62 (or anytime before FRA), it’s important to consider the trade-offs.

Twenty-six percent of respondents to the Schroders 2024 US Retirement Survey did not know that claiming Social Security early reduces their monthly benefit payment. The reality, however, is that receiving Social Security at age 62 reduces your monthly benefit payment by 30%.

Health insurance can be another key trade-off. If you quit your job—losing your employer-provided health insurance—and claim Social Security at age 62, you may have to pay for individual health insurance (which can be quite expensive) until you reach the age of Medicare eligibility for age 65.

As with most major decisions in life, there is no single answer to when to claim Social Security that is right for each person. But if you’ve thought about all the pros and cons, claiming 62 could be right for you.