If you are a worker planning to take Social Security at 62 years old or at any time before your full retirement age, you might want to give some thought to that decision.
According to the Social Security Administration, workers who choose to receive Social Security early may see a reduction in their check amounts by 30%.
“A benefit is reduced 5/9 of one percent for each month before normal retirement age, up to 36 months. If the number of months exceeds 36, then the benefit is further reduced 5/12 of one percent per month,” according to the agency.
If you start receiving benefits at your expected retirement age or any time between that age and 70, you will receive the full amount of benefits.
Here’s what financial experts say you should do to prevent this from happening.
What should you do if you claimed Social Security early?
If you claimed Social Security early and want to make the most of your benefits, there are several things you can do.
Withdraw your Social Security application if its less than a year after you applied
If you filed for Social Security within the past 12 months, you can request to cancel your application.
Just file Form SSA-521, according to FinanceBuzz.
Once your request is approved, it will be as if you had never filed, so you can apply later to receive a higher benefit.
The downside is that, if you have already started receiving benefits, you have to repay every dollar you received, and you are allowed to make this move only once in your lifetime.
Suspend your benefit once you reach full retirement age and work to make up the gap until age 70
If your full retirement age is between 66 and 67, depending on your birth year, you can pause your payments and earn delayed retirement credits at an 8% rate until you turn 70, according to FinanceBuzz.
This can be an attractive alternative to withdrawal because there is nothing to repay.
Don’t retire at all and keep working to get the most out of your benefit
Social Security takes 35 of your highest-earning years to calculate your benefit.
If you did not work during some of those years, or if you had a lower salary in some of those years, continuing to work can increase your benefit.
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