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Should I retire now at age 62 and collect Social Security benefits, or should I wait until age 65?

Unless you live to an especially old age, you may actually end up with more money if you start collecting Social Security benefits at age 62, even though you'll receive approximately 20 percent less per month than if you wait until age 65 to start collecting benefits.

As strange as this sounds, the explanation is quite simple. Even though you'll receive less per month if you start collecting benefits early at age 62, you'll receive 36 more benefit checks than if you begin collecting benefits at age 65. Those benefit checks can add up to a lot of money. In fact, the Social Security Administration estimates that if you wait until age 65 to begin receiving benefits, it will take you until age 77 to make up for those three years of "lost" benefit payments.

However, here are two reasons to wait until age 65 to start collecting benefits. First, if you work full-time past age 62, you'll have the opportunity to increase your eventual retirement benefit, particularly if you are in your peak earnings years, because your benefit will be figured using your 35 highest earnings years. Second, if you'll barely scrape by after you retire, you may want to receive as much as possible from Social Security each month.

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