Social Security: 3 Reasons That 62 Is the "Most Prevalent Age" to Claim Benefits

The experts on Social Security are missing something.

While they continuously preach about the virtues of waiting to apply for benefits, the vast majority of Americans do just the opposite.

According to a recent study by the Government Accountability Office, 62 remains the "most prevalent age to claim Social Security benefits."

With this in mind, I wanted to offer current and prospective retirees a counterpoint to the conventional wisdom. What follows, in turn, are three good reasons to apply for benefits as soon as possible.

1. You want to
Let's get one thing straight from the get-go. Given that you're the one who put in the time and energy to qualify for Social Security in the first place, it almost necessarily follows that you're more than capable of determining the best time to claim them.

Keep in mind that most retirement experts have little on-the-ground experience. Many have white-collar jobs that consist of researching and writing in a calm and collected environment.

They're shielded, in other words, from the physical and psychological strains associated with more traditional blue-collar employment.

In the same study cited above, for instance, the authors found that 61% of respondents between ages 60 and 62 who held jobs in the farming, construction, and mechanical industries, among others, were in positions that demanded and/or involved "heavy lifting most or all of the time."

Suffice it to say, that type of employment isn't well suited for people in their 60s. Consequently, for those who find themselves in this position, there's little question that the scale tips heavily in favor of retirement as opposed to remaining in a physically demanding workplace.

2. You need the money
Of all the misconceptions among experts on the issue of Social Security, I believe the biggest is that everyone has the luxury of deciding whether to receive them early or late.

Ask most retired people, however, and they'd tell you just the opposite.

Consider this: According to the Social Security Administration, 51% of the workforce has no private pension coverage and 34% has no savings set aside specifically for retirement.

Or, how about this: "among elderly Social Security beneficiaries, 22% of married couples and about 47% of unmarried persons rely on Social Security for 90% or more of their income."

The point is that having the ability to defer benefits is a luxury that many people don't have. Consequently, if you're one of these, then you have absolutely no reason to lament the fact that you elected to claim early.

The inability of so-called experts to appreciate this is their shortcoming, not yours.

3. For the average retiree, it doesn't make any difference when you claim
Last but not least, the third reason to apply for Social Security benefits early is because, at the end of the day, it isn't likely to make a huge difference in your lifetime benefits anyhow.

"The Social Security benefit formula adjusts monthly payments so that someone living to average life expectancy should receive about the same amount of benefits over their lifetime regardless of which age they claim," notes the same study I cited earlier.

It accordingly follows that unless you're likely to far outlive the life expectancy of the average American (or you have a spouse or other dependents), then your cumulative lifetime benefits are likely to equal out at the end of the day regardless of when you take them.

With this in mind, in turn, why not get retirement started sooner rather than later? The worst thing that could happen is that by removing yourself from the stress and exertions of the workforce, you thereby extend your lifespan and thus your benefits.

I could be wrong on this count, but it seems to me that there are better things to worry about.

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I think people should not wait until they are 70 to draw social security-the chances that you will not live to 70 are 60/40 and that is kind of like betting on the lottery-with the 40 being the chance that you will live to 70-if you draw the maximum for you of say 25,000 from the time you are 66 until 70 you will have received $100,000-and will continue to receive it after you are 70. If you wait you may not draw a penny-of course your spouse will but the money you can earn on the 100,000 outweighs what you will get at 70.

August 21 2014 at 2:57 PM Report abuse rate up rate down Reply

Though it's anecdotal evidence, two of my co-workers at my last employment delayed claiming their Social Security. One waited until 64 and regretted forgoing the two years of payments he could have put to better use. To make matters worse, he died of cancer at 66. The other was intent on holding off to age 70 and never filed even though he ran a full time business on the side and had a VA disability check coming in monthly. He too succumbed to cancer at age 66. Only his widow is benefitting from his years of contributions. I signed up the month I turned 62.

June 17 2014 at 1:59 PM Report abuse rate up rate down Reply

A big reason to take your benefits at 62, is if you wait until 66 to start, you will forgo approx. $48,000.00 to $58,000.00 by waiting. It takes 12 to 14 years to make that money back with the increased monthly benefit you receive. This estimate is probably on the low side. If you check your benefit statement you can figure it out. Multiply the monthly benefit you will receive at 62 by 48 (months). Then take the monthly increase you will get at age 66. Take that increase(the difference between the age 62 benefit and the age 66 benefit) and divide it into the total amount of the 4 years you would get benefits($48,000 to $58,000). That is the number of months it would take to make up the 4 years of receiving benefits. Multiply the number of months by 12 and add the number of years to 66 and that is how long you would have to live to make up the 4 years of collecting benefits. Probably 80+ years.

June 15 2014 at 1:23 AM Report abuse rate up rate down Reply

It also seems like a good idea to take your Social Security at age 62 before the politicians in Washington cut the benefit and reduce your payout. At least you may be ahead of the game before the axe falls and takes 20% of your expected income away from you. Delaying your benefit may actually result in a lower lifetime payout than grabbing it as soon as possible and getting as much as you can before any changes to the benefit formula occur. There's also the chance that you may be dead at 66 and never collect anything. Cash in the hand is always better than an IOU. Today is better than tomorrow always.... because today is real and tomorrow is a day that may not happen. Take the money and run. You'll be glad that you did. You can't trust Congress to do right by you.

June 14 2014 at 3:26 PM Report abuse +1 rate up rate down Reply