Taking Social Security at age 62 can make sense for some, but it will reduce your payout. For those facing financial emergencies, accessing benefits early may be beneficial. About a third of Americans want to claim Social Security early while still working, but it's important to keep in mind how earned income affects benefits until full retirement age.
The money you earn from a job before reaching full retirement age can affect your Social Security benefits. In 2023, Social Security deducted $1 from benefits for each $2 earned over $22,320, which can significantly impact your finances during those years.
Health issues may force many to retire early, in which case Social Security disability benefits can provide the same as full retirement benefits. Once reaching full retirement age, those benefits are converted to retirement benefits.
Delaying retirement can increase your Social Security benefits, with an 8% increase for each full year you delay. Each year of work adds another year of earnings to your Social Security record, enhancing your future payout.
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