A system of early filing penalties and delayed retirement credits adjusts Social Security benefits for claims between ages 62 and 70. Claiming at 62 reduces monthly benefits—up to about 30% below the standard—while claiming at 70 can increase benefits by roughly 24%. Research indicates that most people currently aged 45–62 would receive more lifetime income by delaying benefits past 65, and over 90% would benefit by waiting until age 70. The design of the penalty-and-credit system assumed shorter life expectancies, so many people now outlive the original projections and gain from delaying claims. Planning to delay claiming preserves larger monthly benefits.
That's because a system of early filing penalties and delayed retirement credits is in place. Under this system, early claimers are supposed to get more checks, but each one is going to be smaller - up to 30% lower than the standard benefit if you claim at 62. On the other hand, late filers are supposed to get fewer checks, but each will be larger. A person who claims at 70, for example, would get up to a 24% bump in their standard benefit.
The biggest reason that you could end up regretting a benefits claim at 62 is that you are likely to end up with more lifetime income if you wait. Research has shown that virtually all Americans who were between the ages of 45 and 62 should wait until after 65 to start their benefits, and the same research showed that over 90% should wait until they reach the age of 70.
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