Early Retirement

It is not surprising that, after being denied on the initial application and then the request for reconsideration, claimants who have filed for Social Security disability benefits or Supplemental Security Income will become angry, annoyed and frustrated with the process. Often times this frustration will lead to claimants giving up on their claims, thereby foregoing benefits they may otherwise have been entitled to.

Do you have questions regarding early retirement? Contact our social security attorneys for help regarding your disability claim today!

For claimants over the age of 62, there is another option that is often considered. That is, electing to receive early retirement. Retirement age, as defined by the Social Security Administration, ranges between the age of 65 and 67. There are, of course, consequences to taking early retirement. While workers can elect to take early retirement as early as age 62, doing so may result in reduction of benefits by as much as 30%. Benefits are reduced by 5/9 of one percent for each month before normal retirement age, up to 36 months. If the number of months exceeds 36, then the benefit is further reduced by 5/12 of one percent per month.

Normal retirement age is 65 for those born in 1937 or before, and 67 for born on 1960 or later. For a complete list see the Social Security website: http://www.ssa.gov/OACT/ProgData/nra.html. The maximum number of months early that retirement can be taken is 60 (this occurs when early retirement is taken at 62 when normal retirement age is 67). In this situation, reduction is calculated as 36 months times 5/9 of one percent plus 24 months times 5/12 of one percent. This results in 30% reduction in benefits.

Although having benefits reduced to some degree may seem like a fair tradeoff to not having to go through the grind of applying for Disability of SSI benefits, any such decision should be made only after carefully weighing all pros and cons. For example, if a claimant decides to forego their claim and accept early retirement, not only are they going to receive reduced benefits, but they are also likely waiving any claim to retroactive benefits they would otherwise have been entitled to.

For example, if it is found that you became disabled when you were 60, then you will receive your full primary insurance amount for the rest of your life. If, however, you decline to appeal the denial of your application so that you can obtain early retirement, then not only are you going to receive less than full benefits for the remainder of your life, but you also will not be compensated at all for the period between the ages of 60 and 62 when your condition precluded you from working.

This is not to state that opting for early retirement will never be in a person's best interest. Other factors, such as accumulating debts or health issues, may change the dynamic entirely. But it is critically important that the decision making process contain a careful evaluation of the positive and negative ramification that early retirement will bring. Only then can a claimant protect his or her rights and knowingly do what is in his or her best interest.

Do you have questions regarding early retirement? Contact our social security attorneys for help regarding your disability claim today!

Always consult with an experienced social security disability professional when you need help getting your disability benefits!