Social Security 62 vs 67 Comparison

The Social Security Administration permanently reduces the monthly benefit for anyone who claims before their full retirement age, and permanently increases it for anyone who delays past full retirement age (up to age 70) -- the earlier or later claiming date changes how many years SSA expects to pay the benefit, so it adjusts the monthly amount to keep the actuarial value roughly balanced across different claiming ages. This calculator takes your own estimated benefit at each age as an input rather than computing that SSA reduction itself.

The real discount rate controls how much future dollars are worth in today's terms -- a higher rate shrinks the present value of payments received further in the future more aggressively than payments received sooner. Because delaying to 67 means the larger checks don't start until five years later, raising the discount rate tends to favor claiming at 62 (since its earlier payments lose less value to discounting), while a discount rate near zero favors whichever strategy pays out more in raw nominal dollars over your planning horizon.

A longer planning age gives the higher age-67 monthly benefit more years to accumulate and eventually overtake the head start that claiming at 62 provides, so extending your planning age tends to shift the present-value comparison in favor of delaying. Someone who expects a shorter retirement generally sees more lifetime value from claiming early, since they may not live long enough for the larger monthly amount at 67 to make up the five years of payments they would have missed.

No -- it's a mechanical comparison of two numbers you supply, run through a present-value formula, and it deliberately ignores factors that a real claiming decision should weigh, such as spousal and survivor benefits, taxation of Social Security income, other retirement income sources, and health status. Treat the output as a way to see how sensitive the early-versus-late tradeoff is to your own longevity and discount-rate assumptions, not as a recommendation to act on.

Nominal totals simply add up every dollar paid without adjusting for when it arrives, so they tend to favor whichever strategy pays for more years or at a higher rate regardless of timing. Present value discounts each future payment back to today, which penalizes the delayed strategy's later start -- so it is entirely possible for claiming at 67 to win on nominal lifetime dollars while claiming at 62 wins (or comes closer) on a present-value basis, especially at higher discount rates.