Claiming Social Security at 62 Can Cut Benefits by 30% as Earnings Rules Trim More
Updated
Updated · The Motley Fool · Jun 4
Claiming Social Security at 62 Can Cut Benefits by 30% as Earnings Rules Trim More
3 articles · Updated · The Motley Fool · Jun 4
Summary
Age 62 filers can see monthly Social Security checks permanently reduced by up to 30%, the standard penalty for claiming before full retirement age.
Workers who claim early can lose additional payments under the earnings test: in 2026, benefits are withheld by $1 for every $2 earned above $24,480, or $1 for every $3 above $65,160 in the year they reach FRA.
Those withheld amounts are restored through higher benefits after full retirement age, but the short-term hit can erase some or all monthly checks when income is still coming from work.
Taxes can further shrink take-home benefits because wages raise provisional income, making more of Social Security taxable.
The analysis says delaying a claim may make more sense for people still working or not needing cash immediately, since waiting raises monthly benefits and ends the earnings test after FRA.