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If I start collecting reduced Social Security benefits early, will my payment increase when I reach full retirement age?

Contrary to what many people think, your payment will not automatically increase to 100 percent of your full retirement benefit when you reach full retirement age, which is 66 and 4 months for people born in 1956 and will incrementally rise to 67 over the next few years.

The financial implications are significant. Say you were born in 1960. In 2022, you will turn 62, the minimum age to claim retirement benefits. But if you do so, rather than waiting until your full retirement age of 67, your monthly benefit will be reduced by 30 percent — permanently.

File at 65 and you lose 13.33 percent. If your full retirement benefit is $1,500 a month, over 20 years that 13.33 percent penalty adds up to nearly $48,000. AARP's Social Security Calculator can give you a sense of the financial impact of claiming benefits at various ages.

The same is true of spousal and survivor benefits: If you claim them early, they are reduced, and they stay reduced even when you pass full retirement age.

If you develop filer’s remorse, Social Security gives you 12 months from the date you applied for retirement benefits to change your mind and cancel that initial claim. You’ll have to repay what Social Security has already paid you, but this way you can refile at full retirement age (or later) and get your full benefit (or more).

There is one circumstance in which Social Security raises your payment at full retirement age, although probably not to 100 percent of your full benefit. That’s if they withheld some of your benefits during early retirement because you had work income that exceeded Social Security’s earnings limit. In this case, they recalculate your benefit at full retirement age to help you recoup those losses.

Keep in mind

After you reach full retirement age, you have the option of temporarily suspending your benefits. During a suspension you can rack up delayed retirement credits, which will increase your eventual payments.

Updated March 7, 2022