Q: If I retire at age 58, will the loss of earnings hurt my Social Security retirement at age 62?
A: An early retirement will probably reduce the amount of your future Social Security because a person’s highest earning years are usually near retirement.
Your Social Security retirement monthly amount is based on your best 35 years of employment, weighted for inflation, and your age, in months, compared to your full retirement age (FRA).
If your earnings record is blank for several years, those years will not be available to replace years of lower earnings when your retirement amount is computed. You can estimate the effect of lower or higher future earnings, or retirement at different ages, with the Retirement Estimator at www.socialsecurity.gov/estimator/.
One of the Social Security retirement planning tools in the Retirement Planner section at www.socialsecurity.gov/retire2/, the Estimator connects to your actual Social Security earnings record to provide personal retirement estimates at age 62, at your full retirement age (FRA), and at age 70. As a security measure, you are asked for personal information before being able to use the Estimator.
Just as on your Statement estimate, the initial Retirement Estimator reply assumes your most recent wages or self-employment earnings will continue into the future. Unlike the Statement, with the Estimator you can change the default reply to obtain estimates at different ages or with different future earnings amounts.
Comparing multiple estimates for any given age based on the initial earnings level and then with lower or higher earnings provides an approximate result of different earnings on your future SSA retirement amount. With separate requests, you can estimate benefits based on either lower or higher earnings. Future earnings of more than one amount cannot be used in one estimate.
The Retirement Estimator provides good estimates at different ages, such as 62, but not for specific months. For estimates in specific months, other online tools are available in the Retirement Planner section. If your interest is only for months before your full retirement age (FRA), use the chart for your FRA. To consider months either before or after your FRA, use the “Compute the effect of early or delayed retirement” calculator. FRA ranges between age 65 and 67 based on year of birth but is 66 for birth years 1943-1954.