The No. 1 Reason to Claim Social Security Benefits at Age 62

Life is chock-full of important decisions. Where to go to school. Which job to take. Whom to marry. Where to live. Those are just a few of them.

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

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Reasons to collect Social Security at 62

There are several reasons to start collecting Social Security benefits at age 62. Let's start, though, with a couple of not-so-good reasons.

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

Thirty-eight percent of the survey's respondents were worried that Social Security would run out of money, so they planned to claim benefits as early as possible. While it's true that if nothing is done, Social Security's trust funds will be depleted by 2035, the program would still be able to pay around 83% of benefits after that point because of ongoing payroll tax receipts. More importantly, Congress will likely make reforms to bolster Social Security before then -- because politicians like to get reelected and making sure retirees get their checks is a popular move.

A better reason to claim Social Security at 62 is because of poor health that is likely to shorten your lifespan. If your health is such that you don't expect to live past the break-even age (when 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 could make sense.

Another good reason to claim Social Security at age 62 is if you face financial difficulties and need the money. For example, if you lose your job at 62 and can't find another one, 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.

The No. 1 reason

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

Is there a positive reason to collect benefits at age 62? I think so. In my opinion, the No. 1 reason to claim Social Security at age 62 is if it will enable you to accomplish what you want in retirement.

For example, you don't have to suffer from poor health to want to travel as much as possible after you retire while you're still able to do so. Collecting Social Security benefits earlier than your FRA could help you afford your dream vacations.

Or perhaps you just don't like your job and are ready to be done working. For some, claiming Social Security at 62 allows them to leave a job they hate and instead enjoy hobbies that they love.

Trade-offs to consider

If you're considering claiming Social Security at 62 (or anytime before your FRA), it's important to consider the trade-offs.

Twenty-six percent of the respondents to the Schroders 2024 U.S. Retirement Survey didn't know that claiming Social Security early reduces their monthly benefits payment. The reality, though, is that receiving Social Security at age 62 cuts your monthly benefit payment by 30%.

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

As with most of the major decisions in life, there's no single answer as to when to claim Social Security that's the right one for every person. But if you've thought through all of the pros and cons , claiming at 62 just might be right for you.

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