Thinking about retiring early at 62? While the Social Security Administration (SSA) allows you to start receiving benefits at this age, your check might be lower than expected.
Let’s break down the key details about early retirement benefits, their average amounts, and how you can maximize your Social Security payments.
Work Credits: The Foundation of Benefits
Before you can claim Social Security benefits, you need to accumulate 40 work credits, which generally takes about 10 years of work.
These credits depend on your wages, and without them, you won’t qualify for retirement benefits. The SSA will calculate your specific benefit amount based on your lifetime earnings record, but you can use average figures as a guide to estimate your monthly checks.
Average Benefits at 62
If you retire at 62 in 2024, your monthly Social Security check will typically range between $1,300 and $1,400. This estimate reflects the reduction for early filing, which decreases your full retirement benefits by about 30%.
To put this into perspective:
- The average retirement benefit for all retirees as of October 2024 is approximately $1,924.
- Early retirees receive significantly less because filing before Full Retirement Age (FRA) locks in a permanent reduction.
For most people, FRA ranges from 66 to 67, depending on your birth year.
Waiting until FRA ensures you receive 100% of your entitled benefits. If you delay filing until 70, your monthly payment increases by up to 24%, thanks to delayed retirement credits.
The Largest Possible Check at 62
Despite the reduction, some high earners can still receive substantial checks if they meet specific conditions. In 2024, the largest Social Security payment for someone retiring at 62 is $2,710 per month. However, to qualify for this, you must:
- Retire at 62.
- Have worked for at least 35 years in jobs covered by Social Security.
- Earned the taxable maximum income during those 35 years.
This maximum benefit will increase in 2025 due to the Cost-of-Living Adjustment (COLA), which is set to boost payments. Starting in 2025, eligible retirees at 62 can receive up to $3,018 per month—a $308 increase.
Factors That Influence Your Benefit Amount
Several factors determine the size of your Social Security check:
- Work Duration: Social Security calculates your benefit based on your highest 35 years of earnings. Fewer years can lower your benefit.
- Earnings: Higher lifetime earnings result in larger benefits.
- Filing Age: The earlier you file, the lower your check. For each month you file before your FRA, your benefit decreases slightly.
- COLA Adjustments: Annual COLA increases help your benefits keep pace with inflation.
Should You File at 62?
Deciding when to claim Social Security depends on your financial situation and life expectancy. Filing at 62 might make sense if:
- You need immediate income.
- You have health issues that may shorten your lifespan.
- You lack other sources of retirement income.
However, waiting until FRA or even 70 often results in significantly larger monthly payments. For instance:
- Filing at FRA avoids reductions and ensures you receive your full benefit.
- Waiting until 70 adds delayed retirement credits, boosting your check by up to 24%.
Planning for the Future
Understanding your Social Security benefits is crucial for retirement planning. Use the SSA’s online calculators to estimate your benefits, and consider factors like health, other income sources, and financial goals.
Waiting a few extra years to file could make a big difference in your long-term financial security.
