JTF#11  

Introduction 

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.

For full paper in PDF

Natalia A. Jivan is a graduate research assistant at the Center for Retirement Research at Boston College. The author thanks Steve Goss, Alicia Munnell, and Kevin Meme for helpful comments. This note is from a larger study on the early retirement age funded by the Russell Sage Foundation.