Final answer:
The maximum Social Security benefit at age 62 varies annually and is reduced compared to the benefit at full retirement age due to early retirement reductions. Individuals' benefits are influenced by lifetime earnings and the age at which they start collecting benefits.
Step-by-step explanation:
The maximum Social Security benefit for someone who retires at age 62 can vary each year based on changes in the national average wage index. Generally, early retirement benefits are reduced based on the number of months you receive benefits before you reach full retirement age, which is currently age 67 for those born in 1960 or later. As of the knowledge cutoff in early 2023, the Social Security Administration has set the maximum benefit at age 62 to be lower than the maximum benefit received if retiring at full retirement age, due to the application of early retirement reductions.
Many factors play a role in determining an individual's Social Security benefit, including lifetime earnings and the age at which one starts collecting benefits. Full retirement age was originally set at sixty-five but has progressively been increased based on legislative changes, with the aim to alleviate some of the financial strains on the system caused by longer life expectancies and a larger population of retirees compared to the workforce contributing to the fund. It is important for individuals to consider how retiring early at age 62 will affect their overall benefits and plan accordingly.