Q & A
I’m avoiding a 20% penalty by not starting my SS payments early at age 62. Am I doing the right thing??
Answer: The Social Security reduction for early retirement is roughly actuarially fair. That is, if beneficiaries live to normal retirement age they receive the same dollar value whether benefits begin at age 62, at full retirement age or any month in between. The age-62 reduction for a worker born in 1942 is about 2 percent. (It rose to 25 percent for persons for whom age 66 is full retirement age and will rise to 30 percent when full retirement increases to age 67.) There is no “magical number” where the reduction becomes minimal. The annual cost-of-living adjustment is added to benefits beginning at age 62 whether or not the wage earner has begun benefits.
Source: http://www.ncpssm.org
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