Should I claim Social Security at 62 while receiving a state pension and still working? WEP concerns?
I'll be turning 62 in a few months and I'm trying to decide if I should claim SS early. My situation is a bit different from what I usually see discussed here. I already receive a defined benefit pension from state employment and I'm working part-time (about 25 hours weekly). My finances are in pretty good shape - I'll have my mortgage paid off within the year, I have decent investment savings, and my monthly expenses are well covered by my pension and part-time work. What I'm considering is claiming SS at 62 and using THOSE funds entirely for additional investments rather than living expenses. Yes, I understand: 1) I'll be locked into a permanently reduced benefit (about 30% less than FRA) 2) I'll have benefits offset due to the earnings test while I continue working But my thinking is: why not start getting SOMETHING that I can invest now instead of waiting until 67 (my FRA)? Even with the reduction, that's still 5 years of payments I could be growing. I'm single, so there's no spouse to consider for survivor benefits. No dependents either. I feel like I'm missing something important in my calculation. Would the Windfall Elimination Provision affect me since I have a state pension? Are there tax implications I'm not considering? Any reason this strategy wouldn't make sense in my situation?
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Aiden O'Connor
You're missing some important considerations. First, since you have a state pension, the Windfall Elimination Provision (WEP) will likely reduce your Social Security benefit beyond just the early filing reduction. This happens if you didn't pay Social Security taxes while earning your pension. The reduction can be substantial - up to $534/month in 2025. Second, think about longevity. If you live past approximately age 80, you'll receive more total benefits by waiting until your FRA. Taking benefits at 62 only makes financial sense if you don't expect to live very long. Third, regarding your investment strategy: remember that SS benefits increase by about 8% per year if you delay from FRA to 70. That's a guaranteed return that's hard to beat with investments, especially on an after-tax, risk-adjusted basis. Fourth, consider the tax implications. Up to 85% of your SS benefits can be taxable depending on your other income. With your pension, part-time work, and investment income, you might be pushing your SS benefits into higher taxation brackets.
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Sofía Rodríguez
•Thank you for bringing up WEP - I completely forgot about that! My state pension is from non-covered employment (no SS taxes), so I would definitely be hit by WEP. You make a good point about the guaranteed 8% increase for delaying. I hadn't really thought about it that way - viewing the delay as an investment itself with a guaranteed return. My family history suggests I'll likely live into my late 80s, so the longevity factor definitely weighs against early filing. With the WEP reduction plus the early filing reduction plus the earnings test withholding... it sounds like I'd be getting a pretty small check for those early years anyway.
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Zoe Papadopoulos
dont forget they take $1 from your benefit for every $2 you earn above the limit when working!!! i think the limit is around $22,000 this year or something like that. so if your working alot you might not even get much SS money anyway until you actually retire!!
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Aiden O'Connor
•That's correct - in 2025 the earnings limit is $22,360. If you're working substantial part-time hours, your benefits could be significantly reduced or even eliminated until you fully retire or reach your Full Retirement Age (when the earnings test no longer applies).
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Jamal Brown
I HATE the Windfall Elimination Provision with a burning passion!!! I worked for 15 years in the private sector paying into SS, then 22 years for county government with a pension. Then when I retired, I discovered my SS was reduced by almost 40%! It's highway robbery and totally unfair to public servants. Have you checked if you have enough "substantial earnings" years (30) to avoid WEP? That's the only way out of this trap.
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Sofía Rodríguez
•Ugh, that sounds frustrating! No, I don't have 30 years of substantial earnings under Social Security. I spent most of my career in the state system. I had no idea the WEP reduction could be as high as 40%! That definitely changes my calculations significantly.
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Fatima Al-Rashid
Totally get your thinking on this! I was in almost exactly your situation (state pension, turning 62, still working part-time) and decided to run the numbers both ways. After factoring in WEP, the earnings test, and taxes, the amount I would have received to invest at 62 was so small that the math just didn't work out. I decided to wait until at least my FRA. I'm 65 now and still waiting!
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Sofía Rodríguez
•Thanks for sharing your experience! It's helpful to hear from someone who was in the same situation. If you don't mind me asking, did you calculate how much you would have actually received after all the reductions? I'm wondering if it would even be worth the hassle of applying.
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Fatima Al-Rashid
•In my case, after WEP and the earnings test, I would have only received about $320/month (and that's before taxes). The paperwork and constant reporting of earnings just wasn't worth it for that amount. When I checked my statement again at 64, waiting until FRA would give me around $1,350/month, and waiting until 70 would be about $1,690. Made the decision pretty simple!
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Giovanni Rossi
Has anyone tried calling SSA to get a personalized calculation that factors in WEP? I've been trying for WEEKS and can't get through to anyone knowledgeable enough to help with a WEP calculation. The online calculators don't handle it correctly. Spent 2+ hours on hold yesterday only to be disconnected!!
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Aaliyah Jackson
•I had the same issue trying to get an accurate WEP calculation. After getting nowhere with the regular phone line, I tried using Claimyr (claimyr.com) to reach an agent. They have a service that gets you through to SSA without the wait. I was skeptical but checked out their video demo (https://youtu.be/Z-BRbJw3puU) and decided to try it. Got through to an agent in about 20 minutes who was able to give me an accurate calculation with WEP included. Saved me hours of frustration.
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KylieRose
One factor that hasn't been mentioned yet is that claiming early could affect your Medicare Part B and D premiums later through IRMAA (Income-Related Monthly Adjustment Amount). Since you plan to invest the SS money, the investment income could push your Medicare premiums higher when you enroll at 65. Also, don't forget to check if the Government Pension Offset (GPO) might affect you in the future if you were to marry. GPO can reduce or eliminate spousal/survivor benefits if you receive a pension from non-covered work. With your state pension, part-time work, and investments, I suspect the smart play is to delay SS as long as possible to maximize the benefit when you do take it. The 8% guaranteed increase per year from FRA to 70 is essentially free money with no risk.
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Sofía Rodríguez
•I hadn't even considered the IRMAA implications for Medicare premiums. That's a great point. Between the earnings test, WEP reduction, potential tax implications, and now IRMAA considerations, it seems like waiting is probably the better strategy in my case. I appreciate everyone helping me see all the angles I was missing!
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Zoe Papadopoulos
my neighbor took ss at 62 and regrets it EVERY DAY!! says its the biggest financial mistake he ever made. hes 78 now and always complaining about how much more hed be getting if hed just waited!!
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