Laid-Off 57-Year-Old Risks 30% Social Security Cut by Claiming at 62

3 articles · Updated · 24/7 Wall St. · Jun 27

A 57-year-old single woman who lost her job faces a two-part Social Security hit if prolonged unemployment pushes her to claim benefits at 62.
Social Security uses a worker’s 35 highest-earning years, so missing late-career wages can lower future checks if those years would have replaced weaker early-career earnings.
Claiming at 62 instead of 67 locks in a permanent reduction of up to about 30%—turning a $2,000 monthly benefit into roughly $1,400, or more than $7,000 less a year.
Part-time or contract work can help bridge the gap, slow savings drawdowns, and potentially improve the earnings record; divorced workers married at least 10 years may also qualify on an ex-spouse’s record.
With unemployment at 4.3% and jobless claims at a three-month high in early June, the report urges workers to check SSA.gov estimates and map financing options before claiming early under pressure.