For many Americans approaching retirement, the idea of claiming Social Security benefits at age 62 is tempting. It offers early access to a steady stream of income and can bring a sense of security during uncertain times. But financial expert Suze Orman says this move is often a costly mistake.
In a recent episode of her "Women & Money" podcast, Orman pulled no punches: "Taking your Social Security payments at 62 is wrong." Here's what she means — and why it may be worth waiting.
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Claiming Early Comes at a Cost
While age 62 is the earliest point you can claim Social Security benefits, doing so permanently reduces your monthly payments. Orman reminds listeners that 62 is usually five years before full retirement age, which is between 66 and 67, depending on your birth year.
That early start results in up to a 30% reduction in your monthly benefit — for life. "You are taking a serious hit on it, but that makes you feel more secure," she said. While the idea of receiving money sooner may feel like a safe move, Orman believes many people are letting fear dictate their financial decisions.
Who Benefits When You Claim Early?
Orman argues that claiming early often benefits the system more than the retiree. "The more of you that take it at 62, the less they have to pay you later on," she said. In other words, starting benefits early helps save money for Social Security, but may cost retirees tens of thousands of dollars over time.
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With concerns about the future of Social Security funding and the state of staffing with offices being shut down, some Americans are rushing to claim benefits out of fear the program will run out or face serious disruptions. But Orman says this is the wrong approach.
"That doesn't mean Social Security is going to collapse," she stated.
When Taking Benefits Early Might Make Sense
Orman acknowledges that there are valid reasons to claim Social Security at 62. If you’re in poor health or have a terminal illness, taking benefits early may be practical. But in most cases, she says waiting is the better option — especially for married couples.
"Most of the time it absolutely makes no sense at all taking Social Security before your full retirement age," she said. "And I will still say in most cases if you can wait till you are 70 and it makes sense to do so…especially if you are married."
Take Time To Create a Plan
Rather than making a quick decision based on fear or uncertainty, Orman urges listeners to plan carefully. The key, she says, is figuring out both the best and worst times for you to claim benefits — not just emotionally, but financially.
"Take action with your Social Security," Orman said. That means understanding how timing impacts your lifetime income and considering your health, marital status, and overall retirement plan.
Bottom line: If you're nearing retirement, it may be worth thinking twice before taking Social Security at 62. A little patience — and planning — can pay off in the long run.
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