The percentage of people filing for Social Security benefits as soon as possible at age 62 is declining, according to new research from the Center for Retirement Research at Boston College.
This information conflicts with most studies that say the percentage of early applicants has remained steady over the years, despite increased longevity and lengthening retirement years.
The center says other studies have been looking at the numbers incorrectly. In fact, the percentage of early applicants is actually declining, as you would expect as people are working longer, according to Trends in Social Security Claiming, written by Alicia H. Munnel, director of the Center for Retirement Research, and research associate Anqi Chen.
The percentage of eligible men claiming retirement benefits at age 62 has decreased from 1996, when it stood at 56 percent, until 2013, when it had dropped to 36 percent, the research shows. The percentage of eligible women dropped from 63 percent to 40 percent for the same time period.
Most studies say the percentage of people claiming Social Security benefits as early as possible has remained at about 42 percent for men and 48 percent for women over the years.
However, those percentages are calculated on the total number of people who claim benefits in any given year, rather than on the number of people eligible. In other words, 42 percent of the people who claimed benefits in 2013 were claiming at age 62, most studies show.
The Center for Retirement Research is using the total number of people eligible for Social Security in each year, a pool or cohort that is continually growing because of increasing birth rates in the baby boom years. This data reveals a more relevant picture, according to the researchers, because it shows the percent of those turning 62 who claimed at 62.
The numbers are important because Social Security benefits increase each year that the recipient delays taking benefits until age 70. The longer people wait to take benefits the more money they receive each month for the rest of their lives. With increasing life spans that increased benefit can add up to a significant amount of money, financial advisors who specialize in Social Security point out.
The Center for Retirement Research says, “The good news is that more people are claiming retired-worker benefits at later ages, and this pattern is consistent with the increased labor force participation at older ages and the rise in the average retirement age.
“Nevertheless, in 2013 more than a third of insured workers still claimed Social Security benefits as soon as they became eligible. The question is whether this decision appropriately reflects the individual and family circumstances of these individuals or whether they are making a mistake,” the report concludes.