It’s indeed never too early to plan for the golden years—but be aware that there are certainly some financial decisions that will directly impact—positively and negatively—the rest of one’s life.

For example, there is nothing stopping individuals from collecting Social Security benefits as early as age sixty-two but do keep in mind that the total amount of benefits will be permanently reduced.

And contrary to what many Americans might be thinking, the benefit amount will not automatically increase to a hundred percent of the full retirement benefit when one reaches full retirement age—currently sixty-six and two months. Over the next few years, though, the full retirement age will gradually rise to sixty-seven.

According to the Social Security Administration (SSA), “there are advantages and disadvantages to taking your benefit before your full retirement age. The advantage is that you collect benefits for a longer period of time. The disadvantage is your benefit will be reduced. Each person's situation is different.”

The agency continues: “It is important to remember: If you delay your benefits until after full retirement age, you will be eligible for delayed retirement credits that would increase your monthly benefit. That there are other things to consider when making the decision about when to begin receiving your retirement benefits.

If you decide to delay your benefits until after age sixty-five, you should still apply for Medicare benefits within three months of your sixty-fifth birthday."

‘Significant’ Financial Implications

AARP, a U.S.-based interest group focusing on issues affecting those over the age of fifty, contended that deciding to take Social Security benefits early has “significant” financial implications.

“If your full retirement age is sixty-seven and you claim Social Security at sixty-two, your monthly benefit will be reduced by 30 percent—permanently. File at sixty-five and you lose 13.33 percent. If your full retirement benefit is $1,500 a month, over twenty years that 13.33 percent penalty adds up to nearly $48,000,” the organization says.

“The same is true of spousal and survivor benefits: If you claim them early, they are reduced, and they stay reduced even when you pass full retirement age,” it adds.

Okay to Change Mind?

There is, however, a way to change one’s mind after filing for Social Security benefits. The SSA offers the option to cancel that initial claim one year from the date one applied for the benefits. Do beware that the money that the SSA had already paid out will have to be given back.

There is also another situation in which the SSA could boost benefit payments at full retirement age.

“That’s if they withheld some of your benefits during early retirement because you had work income that exceeded Social Security’s earnings limit. In this case, they recalculate your benefit at full retirement age to help you recoup those losses,” AARP notes.

“After you reach full retirement age, you have the option of temporarily suspending your benefits. During a suspension you can rack up delayed retirement credits, which will increase your eventual payments,” it continues.

Ethen Kim Lieser is a Minneapolis-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.