Should You Claim Social Security at 62? 3 Situations Where It Actually Pays Off.

Landing on the right Social Security filing age isn't easy. Not only do you have a wide range of choices, but each option has huge implications for your monthly benefits.

If you claim Social Security on time -- meaning, at full retirement age -- you'll get the monthly benefit you're entitled to based on your personal wage history. Full retirement age is 67 if you were born in 1960 or later.

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However, you're allowed to claim Social Security as early as age 62. And while doing so will result in about a 30% reduction compared to filing for benefits at 67, in some cases, it pays to take that hit. Here are three scenarios where an early filing could actually work to your advantage.

1. You have serious health issues

One of the biggest factors in your Social Security filing history should be longevity. If you expect to live well into your 80s or 90s, claiming Social Security after full retirement age for boosted checks often results in higher lifetime payouts. Your benefits grow 8% for each year you delay, until you turn 70.

On the other hand, if you have serious medical issues that are likely to shorten your lifespan, it changes the math. If you're more likely to live a shorter lifespan than a longer one, claiming Social Security at 62 could make sense because it gives you access to your monthly checks sooner.

For example, let's say you're eligible for $2,000 a month in Social Security at age 67, but you sign up at 62 and reduce your monthly checks to $1,400 apiece. If you only live until age 76, you'll collect a total of $216,000 in Social Security if you take benefits at 67 versus a total of $235,200 if you file at 62. That's a difference of a little more than $19,000.

2. You need the income immediately

Workers are often encouraged to save well for retirement to have income to supplement Social Security. But funding an IRA or 401(k) is easier said than done when bills consistently pile up and costs keep rising.

If you find yourself out of work at 62 or only able to work part-time, and you don't have a lot in the way of retirement savings to live on, then claiming Social Security at 62 could be a wise choice. Even though you'll slash your benefits, filing for Social Security as soon as you're able to could spare you from having to borrow money and rack up loads of interest to cover your costs.

3. You're trying to save your investment portfolio

Maybe you did manage to save a nice amount of money for retirement, and you're sitting on a healthy portfolio by the time your career has come to an end. That's a great position to be in. But if the stock market crashes right around that time, withdrawing from your portfolio could mean locking in losses you might never fully recover from.

In a situation like this, an early Social Security claim could be your ticket to preserving your portfolio by giving you time to wait for a market recovery. And while you'll slash your monthly benefits by filing at 62, you might save yourself from tremendous investment losses in the process.

While financial experts often warn about the dangers of claiming Social Security at 62, it's not automatically a bad decision. In some cases, filing for benefits as early as possible makes a lot of sense, especially if your health makes you unlikely to live a long life, you have a pressing need for income, and you need to leave your investments untouched during a stock market downturn.

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