The number of Americans opting to take Social Security at 62 -- currently the youngest age allowed -- is on the rise. In 2009, 42% of 62-year-olds claimed benefits, up from 38% in 2007, according to economists at the Brookings Institution in Washington, D.C.
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Afraid that lawmakers will soon raise the retirement age of Social Security or shrink benefits, many are ignoring the traditional advice of financial planners and retirement experts everywhere and taking their benefits as soon as possible.
Advisers say the average pre-retiree typically underestimates the impact of taking benefits early. For example, a top earner retiring at 62 would get $1,803 a month. By waiting until 66, he'd increase that amount to $2,442, and delaying until 70 would bump the monthly payment to $3,256, according to Rande Spiegelman, the vice president of financial planning at the Schwab Center for Financial Research. Another way to look at it: People who take Social Security at 66 rather than at 62 will collect more money over time, provided they live to at least age 77.
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