The decision to apply for early Social Security benefits is sometimes prompted by unexpected unemployment, sometimes by health issues that make continuing to work difficult or impossible, and sometimes simply by a desire to dedicate some time to yourself and your own personal passions. Applying for Social Security is a relatively easy process, assuming you qualify for benefits and are able to provide the appropriate documentation.
Qualifying
The Social Security Administration (SSA) provides some useful tools to facilitate your application. The Benefit Eligibility Screening Tool (BEST) is available through the SSA website; without having to provide your Social Security Number, you will answer a series of questions to determine eligibility for Medicare, Social Security Disability, Social Security Retirement, Social Security Survivor benefits, Special Veterans benefits, and Supplemental Security Income.
Know the Consequences
You will receive reduced benefits if you apply for Social Security before you reach standard retirement age--which is no longer 65 for everyone, but depends on the year in which you were born. The SSA allots you a specific amount of money, which you receive in monthly payments from the time of retirement until your death. Collecting benefits early decreases the monthly disbursement by five-ninths of 1 percent for each month before you reach your standard retirement age. If you apply later than your standard retirement age, you will receive 8 percent more in benefits for each year you delay retirement.
Ultimately, these penalties and rewards are just tools to help you determine whether your Social Security benefits are likely to cover your living expenses in retirement.
Take life expectancy into account as well when deciding when to apply. The longer you wait, the older you'll be when you reach the "break-even-point": the point at which you begin receiving more in benefits than you paid into the Social Security system during your working life.
Applying for Benefits
You can apply for benefits at the SSA website, or call your local SSA office for a personal appointment.
Either way, you'll have to provide documentation to establish your identity and your eligibility. If possible, provide an original or officially issued birth certificate and Social Security card. If you're not a native-born American, bring proof of citizenship or lawful-alien status. You'll also need your previous year's W-2 form or tax return.
However, should any of these documents prove difficult to produce, the SSA still encourages you not to delay your application.
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