What happens if you collect Social Security early?

The earliest you can claim Social Security benefits is 62. But if you claim before reaching your full retirement age (FRA), your monthly benefits will be permanently reduced.

That hasn't stopped millions of Americans, though: According to Social Security Administration data, close to 60% of the 3.46 million Americans who newly claimed benefits in 2025 hadn't reached their full retirement age.

Here's what to know about collecting Social Security benefits before full retirement age, including the penalties, the advantages and why people do it.

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If you were born in 1959, your FRA is 66 and 10 months. If you were born in 1960 or later, your FRA is 67.

If your FRA is 67, filing a claim at 62 will result in a 30% reduction in benefits for the rest of your life.

Here is a broad comparison of someone collecting at their FRA of 67 vs. at other ages. Keep in mind this doesn't address cost-of-living adjustments (COLAs), post-retirement earnings, taxes, Medicare or other expenses.

If you were born in 1960 or later:

• Claiming at 62 vs 67 means a 30% reduction in your monthly benefit
• Claiming at 63 vs 67 means a 25% reduction
• Claiming at 64 vs 67 means a 20% reduction
• Claiming at 65 vs 67 means a 13.3% reduction
• Claiming at 66 vs 67 means a 6.7% reduction

Even though claiming before your FRA results in a smaller monthly benefit, you are receiving payments that you otherwise would not have.

If you wait until your FRA of 67 to file, but die at 68, the net result is you would have pocketed more money if you had started at 62.

The Social Security break-even point is the age when the cumulative lifetime payout from delaying benefits catches up to the total amount you would have collected by starting earlier. For most people comparing age 62 to FRA (66¹⁰/₁₂ to 67), the break-even age is around 78 to 79.

Knowing your break-even point can guide your decision-making when applying for benefits. If you expect to live beyond your break-even point, delaying benefits may make more sense.

The simplest way to calculate your break-even point is to divide the total dollar amount you're giving up while waiting by the difference in monthly benefits.

For example, if your benefits are $1,400 a month at 62 and $2,000 per month at 67:

• There is a period of 72 months (or six years) that you're forgoing benefits.
• $1,400 × 72 months = $100,800, the amount you forgo by waiting until 67.
• At 67, you receive $600 more per month than you do at 62.
• $100,800/$600 = 168 months (14 years).
• 67 + 14 years = a break-even age of about 81.

A Social Security break-even calculator can give you a more detailed estimate. In either case, you'll need to know roughly how much you'll receive in both scenarios.

If waiting a few years to collect Social Security benefits could mean earning thousands more over the course of your life, why do so many people apply for benefits before they reach their full retirement age?

According to a 2025 U.S. retirement survey from global asset management firm Schroders, 44% of non-retirees say they plan to file for Social Security benefits before turning 67.

Reasons given include:

• I want access to the money as soon as possible (37%)
• I'm concerned Social Security may run out of money (36%)
• I will need the money earlier for regular income (34%)
• I was advised to take it earlier than age 70 (15%)

Suzanne Shu, a marketing professor at Cornell, says many people collect early because they don't understand how Social Security works.

"It's almost as if they are thinking about Social Security as a defined contribution plan or 401(k)," Shu told CNBC Select. "The more people feel that sense of ownership, the more they want to claim early." 

Immediate gratification is a big factor, too, she added. Just like someone may value the short-term pleasure of skipping the gym over the long-term benefits of exercise, they're more focused on having that check in their account now than on the long-term implications of collecting Social Security early. 

There is also a feeling that they're "missing out" by not getting benefits sooner, she added. According to prospect theory, people don't view gains and losses equally: The psychological pain of losing something is twice as powerful as the pleasure of gaining the equivalent thing — a condition known as "loss aversion."

People have spent their entire lives paying into the system, Shu said, and many believe that, by not collecting early, they'll "lose out" on benefits they won't receive after they die.

Shu adds that many people misunderstand the difference between life expectancy and lifespan.

"Even people who should expect longer lifespans tend to underestimate how long they'll live," she said.

The average life expectancy at birth for someone living in the U.S. is about 79 years, according to the CDC. But that's factoring in includes people who died in infancy and young adulthood, so it isn't an estimate of how long a 65-year-old can expect to live.

According to the Social Security Administration, a man who is 65 in 2026 can expect to live, on average, another 18.4 years — or until age 83.4. A woman who is 65 in 2026 will live, on average, another 20.9 years, until about 85.9.

"Let's say they work for about 30 years — it's not inconceivable that they will have another 30 years ahead of them in retirement," Shu said. "So, if you think about all of those years in retirement as close to the number of years that you spent in the workforce, it starts to change how much of a rush you are to claim your benefits."

Shu doesn't offer a blanket directive to delay claiming Social Security — collecting early may make sense if you need the income or have health concerns. But she recommends calculating how much more money you'd earn by postponing, especially if you end up living into your 80s or 90s.

"People don't typically think about the regret they'll feel later if they collect early and lock in a lower monthly payment," she said.

You can't start Social Security at 62, stop receiving it at 65, and simply reset the clock. But if you're within 12 months of first filing for Social Security, you may be able to withdraw your application.

You typically have to repay all benefits you've received, but you'd be able to reapply later as if it were the first time.

If you've gone past the 12-month mark, your only option is to suspend benefits. Payments stop, and you begin earning delayed retirement credits of up to 8% annually until you hit age 70.

This doesn't erase your earlier claim, though, so you won't get back the benefits you received before you suspended your claim.

"If you decide to claim early, it generally won't reduce the maximum spousal benefit available to your partner. Someone who claims spousal benefits at their FRA can receive up to 50% of the worker's primary insurance amount (PIA), regardless of whether that worker claimed early or delayed."

At the same time, they won't receive a larger check if you waited until after FRA to claim and earn delayed retirement credits. If you had a PIA of $2,000 but delayed claiming until 70 and now receive $ 2,480, your partner's maximum spousal benefit is still $1,000, not $1,240.

What's important is the age of the person filing for spousal benefits: Claiming spousal benefits before FRA permanently reduces the benefit. Someone who claims at age 62 will receive approximately 35% of the higher earner's FRA benefit, not the full 50%.

If you're eligible for both your own retirement benefit and a spousal benefit, Social Security generally pays your own benefit first and then adds a spousal benefit only if you're entitled to a higher amount.

Social Security was never intended to cover all your financial needs in retirement. Financial security in your post-working years means leveraging other options.

1. Retirement funds

If your company offers a 401(k), try to contribute at least enough to max out any employer match. An individual retirement account (IRA) isn't tied to your workplace, so you can keep making contributions if you change jobs.

Contributions to a traditional IRA go in pre-tax, which makes it a good investment vehicle if you expect to be in a lower tax bracket when you retire. With a Roth IRA, contributions are post-tax — so your money grows tax-free and you can make withdrawals tax-free.

There are annual contribution limits to both, however, and income limits on who can open a Roth IRA.

Vanguard is a strong choice for investors who want low-cost, self-directed retirement planning. We recommend Betterment if you want more guidance and automation — the platform will build and manage a diversified portfolio for you, based on your risk tolerance and time horizon, with features like automated investing and tax-saving technology.

2. Investments

A diverse portfolio is a smart move when building your retirement strategy: Stocks, bonds, CDs and other investments can spread risk and help you weather market fluctuations.

Charles Schwab's Schwab Stock Slices allow investors to buy fractional shares from up to 30 S&P 500 companies, for as little as $5 each.

If you're new to investing, J.P. Morgan's Self-Directed Investing platform has an intuitive interface with no minimum balance requirement and no commissions on online mutual fund trades.

3. Annuities

An annuity provides guaranteed income for a set period or even for life. You can fund an annuity in a lump sum or through a series of payments, and the investment can grow either at a fixed or variable rate. You can also select an annuity that's tied to a market index, with caps on gains and losses.

Athene and Mass Mutual are two of CNBC Select's top picks for annuity companies.

At CNBC Select, we work with experts who have specialized knowledge and authority, backed by relevant training and experience. For this article, we interviewed Suzanne Shu, a marketing professor at Cornell University's SC Johnson School of Business.

Dr. Shu received a PhD and MBA from the University of Chicago. She also holds a master's in electrical engineering from Cornell University.

At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every retirement article is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of retirement products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.

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