How Can The Actuarial Reduction For Social Security Early Retirement Be Right?

Natalia A. Jivan ()
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Natalia A. Jivan: Center for Retirement Research at Boston College
Authors registered in the RePEc Author Service: Natalia Zhivan ()

Just the Facts from Center for Retirement Research

Abstract: Traditionally Social Security's Normal Retirement Age has been 65, but for the last 45 years both men and women have had the option to claim benefits at the Early Eligibility Age (EEA) of 62. In exchange for claiming early, individuals receive a smaller monthly benefit. The legislation that established the EEA reduced benefits by 5/9 of 1 percent for each month before age 65, so that a person claiming at age 62 would face a 20 percent [(5/9)*36] reduction. This publication explains the factor of 5/9 and why it has remained constant since the establishment of the EEA.

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Date: 2004-08-13

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Working Paper: How Can the Actuarial Reduction for Social Security Early Retirement Be Right? (2004)
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