Retire at 62 vs. 67: The Complete Comparison
Five extra years of freedom vs. five more years of work. The financial trade-offs are more nuanced than most people realize.
This scenario covers
Social SecurityThe SS Benefit Trade-Off
Claiming SS at 62 locks in a 30% permanent reduction from your Full Retirement Age (FRA) benefit. Waiting to 67 gets the full benefit. Each year of delay from 62 adds approximately 6–8% more per year.
| Claim age | Monthly benefit | Annual income | Breakeven vs. 62 |
|---|---|---|---|
| 62 (early) | $1,680/mo | $20,160/yr | Baseline |
| 65 | $2,080/mo | $24,960/yr | ~Age 79 |
| 67 (FRA) | $2,400/mo | $28,800/yr | ~Age 79–80 |
| 70 (maximum) | $2,976/mo | $35,712/yr | ~Age 82 |
PortfolioWhat Each Option Requires from Your Portfolio
Retiring at 62 means 5 more years of withdrawals — before Social Security — and lower SS income for life. That combination requires a substantially larger portfolio to be sustainable.
| Factor | Retire at 62 | Retire at 67 |
|---|---|---|
| Retirement horizon (to age 90) | 28 years | 23 years |
| Annual portfolio withdrawal (pre-SS) | $65,000/yr × 5 yrs | $0 (still earning) |
| Annual portfolio gap (post-SS) | $65K − $20K = $45K/yr | $65K − $29K = $36K/yr |
| Required portfolio (3.5% SWR) | ~$1,285,000 | ~$1,028,000 |
| Portfolio gap | $257,000 more needed to retire at 62 | |
"Required portfolio" here sizes only the post-Social-Security annual income gap at a 3.5% withdrawal rate; the retire-at-62 column's separate five-year, pre-SS bridge draw ($65,000/yr × 5) is an additional cash need on top of that figure, not included in it.
HealthcareThe Healthcare Gap: 62–65 vs. None
Retiring at 62 means 3 years without employer healthcare and without Medicare. Retiring at 67 eliminates this gap entirely (Medicare starts at 65 while still employed).
| Option | Healthcare years 62–65 | Estimated extra cost |
|---|---|---|
| Retire at 62 | ACA marketplace (subsidized) | $6K–$15K/yr × 3 yrs = $18K–$45K total |
| Retire at 67 | Employer coverage (62–65) | ~$3K–$6K/yr employee share |
Lifetime WealthWho Comes Out Ahead Financially?
Depending on longevity, the financial advantage shifts. Short-lived retirees benefit from retiring and claiming SS early. Long-lived retirees who wait generally accumulate more lifetime income.
| Lifespan | Retire at 62 lifetime SS | Retire at 67 lifetime SS | Winner |
|---|---|---|---|
| To age 75 | $262,000 | $230,000 | 62 wins by ~$32K |
| To age 82 | $403,000 | $432,000 | 67 wins by ~$29K |
| To age 90 | $564,000 | $662,000 | 67 wins by ~$98K |
| To age 95 | $665,000 | $806,000 | 67 wins by ~$141K |
Verdict: Which Age Wins?
Financially, waiting to 67 wins for most people with average or above-average life expectancy. But "winning" financially is not the only goal. If health is declining, work is intolerable, or freedom is the priority, the value of 5 extra retirement years may well exceed the financial cost. Use the calculator to model your specific numbers — the right answer depends entirely on your health, portfolio, and priorities.
Note: this page compares two work-retirement ages. Deciding when to start collecting your Social Security check is a related but separate decision — see Social Security 62 vs. 67 vs. 70 for that comparison, including age 70.