The $150,000 Mistake People Make at Age 62

Every year, a large share of US workers leave the workforce in their early 60s for a reason they did not choose: their health issues make it impossible to keep working. Many take the same fateful next step at age 62. They contact Social Security and claim retirement benefits at the earliest age allowed, usually knowing that the decision permanently cuts their monthly check by up to 30% compared with what they would get at full retirement age.

What far fewer realize is that a health condition serious enough to end a career may also qualify them for Social Security Disability Insurance, or SSDI. Unlike claiming early retirement benefits, workers approved for SSDI are paid the amount they would receive at full retirement age (67 for most people claiming today). There is no permanent reduction in monthly income. For a typical worker, the difference could add up to $150,000 over the course of their retirement.

Differences go beyond the monthly check. Someone qualifying for SSDI at 62 typically gets earlier access to Medicare than someone claiming early retirement benefits. SSDI may also open the door to other support, including federal student loan discharge for those who qualify, certain housing assistance programs, and benefits for eligible dependents.^  

To better understand why so many workers with disabilities make the costly mistake of choosing early retirement instead of SSDI, Atticus surveyed people between the ages of 62 and 67 who are currently receiving Social Security early retirement benefits and who left work because of their physical health, their mental health, or both. The results point to a widespread awareness gap: 72% did not know SSDI pays more than early retirement. Nearly 50% said no one, at any point, discussed SSDI with them as an option, even though this is a benefit they have been paying for out of every paycheck. 

Note on terminology: Congress passed the Claiming Age Clarity Act on September 29, 2026. The legislation directs the Social Security Administration (SSA) to use “minimum benefit age” instead of “early eligibility age” to describe when a worker claims retirement benefits at age 62. The SSA is also directed to use “standard monthly benefit age” instead of “full retirement age” or “normal retirement age.” Eligibility rules and benefit amounts are unchanged. The bill awaits the president’s signature as of the date of this report’s publication. This report uses “early retirement” and “full retirement” to match the terms familiar to respondents and used in our survey.

Key takeaways

Among early retirees who reported leaving the workforce due to their health: 

• 72% didn’t know SSDI pays more than early retirement. 42% were not sure, 22% believed the two benefits pay about the same, and 8% believed early retirement benefits (ERB) generally pays more. 

• 49% said no one had ever discussed SSDI with them as an option. Only 22% had heard about it from the Social Security Administration itself.

• 46% sought no advice at all before claiming early retirement, a decision that permanently reduces the size of their monthly check.

• 64% never applied for SSDI. The top reason, cited by 41% of non-applicants, was the mistaken belief that disability benefits are only for people who cannot do any work at all.

• 50% of those who never applied said they would likely have made a different decision had they known how the two benefits compare.

• A benefit increase would go a long way for this group. 67% of respondents report household income under $50,000 a year, so a gap of $100,000 or more over a retirement makes a real difference. 

What claiming early retirement at age 62 really costs when you could have qualified for SSDI 

For eligible early retirees, the impact of claiming early retirement benefits instead of SSDI can be striking: a permanently reduced monthly benefit check, a longer wait to access Medicare*, and reduced benefits for eligible dependents. 

Consider a worker whose full retirement benefit, or primary insurance amount, is $2,083 a month, roughly what the average retired worker received in mid-2026. Both retirement and SSDI benefits are calculated on the same earnings record. If approved for SSDI at 62, this worker receives the primary insurance amount of $2,083. In contrast, the same worker claiming early retirement at 62 receives up to 30% less for life^, which means a reduced monthly check of about $1,458. 

Further, when an SSDI recipient reaches 67, disability benefits automatically switch to Social Security retirement benefits, preserving the individual’s primary insurance amount for as long as they claim. Over 20 years, that gap of roughly $625 per month works out to $7,500 a year and about $150,000. For higher earners, the benefit gap is wider still. 

The monthly check is only part of the benefit package. SSDI beneficiaries get Medicare after 24 months of benefits, with a few exceptions. A worker claiming early retirement at 62 must wait until 65 for Medicare coverage. Some choose to cover the gap with private health insurance options; others forgo insurance, racking up high out-of-pocket costs (or worse, avoiding care altogether). For someone too sick to work, health coverage can matter more than the payment itself. 

SSDI also includes a lesser-known protection called “the disability freeze.” Because Social Security benefits are computed from a worker's 35 highest earning years, any years of zero or reduced earnings caused by disability would ordinarily lower the average and shrink the monthly benefit. The freeze excludes those years from the calculation, preserving the benefit amount both during the disability period and in retirement. Early retirement benefits claimants who were actually disabled when they left the workforce receive no such protection, meaning they may be doubly penalized: once by the early claiming reduction, and again by the zeros in their earnings record.

Still, claiming early retirement remains the norm, even for people who may qualify for SSDI. 62% of retired workers receive reduced benefits for claiming before full retirement age, amounting to over 30 million people. In 2025 alone, about 2.1 million of the 3.9 million people newly awarded retirement benefits took the reduction. EBRI's 2026 Retirement Confidence Survey found health problems or disability to be the most common reason people retire earlier than planned, suggesting that hundreds of thousands of those new beneficiaries likely had a disability case worth evaluating. What kept them from doing so comes down, in large part, to awareness. 

The awareness gap is real

Survey respondents left work for health reasons: 57% because of physical health, 7% because of mental health, and 36% because of a mix of both. All fit the profile of workers who should have evaluated their SSDI eligibility before locking in a reduced retirement check for life. Most claimed as early as the rules allow: 65% began benefits at exactly age 62.

To understand what they knew about their options when they claimed early retirement, we started with a simple knowledge test: for people ages 62 to 66 who leave the workforce early, how do SSDI and early retirement benefits compare? Fewer than 30% got it right. 

Exhibit 1. Only 28% of respondents correctly said SSDI typically pays more. Atticus survey of 250 early retirement claimants who left work for health reasons. September 2026. 

Knowledge of the additional benefits that accompany SSDI was similarly thin. Only 55% knew the program unlocks early access to Medicare, arguably its second most valuable feature. And only 28% knew that SSDI converts to a full, unreduced retirement benefit at 67. Nearly half of respondents, 48%, simply were not sure.

The reason for this costly lack of information is simple: no one told them about SSDI. Nearly half of respondents, 49%, said no person, agency, or resource had ever raised SSDI with them as an option. That gap is striking because SSA is supposed to catch these cases. When workers claim early retirement, SSA directly asks applicants whether a health condition in the past 14 months left them unable to work. But SSA often fails to follow up and consider disability if the claimant says “yes.” The survey results reflect this: Only 22% of our respondents recall someone at the SSA raising SSDI with them.

Before applying, early retirees are hesitant to seek guidance. Asked whether they sought any advice before applying for early retirement, 46% said no. Among those who did ask someone, the most common sources were SSA staff (20%), friends and family (16%), and lawyers (15%). 

Prior research suggests information moves the needle. A 2026 National Bureau of Economic Research study linked Social Security's own application records to a national survey and found that when people in their early 60s received a Social Security statement showing what disability and retirement would each pay them, disability applications rose sharply among those with a work-limiting health condition, roughly 400% more than among people without health concerns. 

This is roughly in line with the results of our survey. 64% of respondents never applied for SSDI at all. Their reasons read like a list of the program's most common myths: that disability is only for people who cannot do any work at all, that it might affect their future retirement benefits, and more (as shown in Exhibit 5). 

Then we told respondents how the benefits actually compare and asked whether they would have made a different decision. Among those who never applied for SSDI, 50% said it was very or somewhat likely they would have made a different decision had they known more about the program.

Exhibit 6. Half of non-applicants said they likely would have chosen differently had they known. n=159.

This is a population that can least afford to leave money unclaimed. Two thirds of respondents report household income below $50,000, and 39% report less than $25,000. 

What people facing this decision need to know

SSDI is a social insurance program, funded by payroll taxes taken out of workers’ paychecks. It’s built for those who can no longer engage in a substantial amount of work activity because of a medical condition expected to last at least a year or result in death. Qualifying takes two things: (1) enough recent work credits, which most people who have worked steadily into their 60s have, and (2) medical evidence that the condition seriously limits their ability to work.

The survey's most common misconception, that disability is only for people who cannot do any work at all, is especially untrue for older applicants. Social Security's medical-vocational grid rules explicitly account for age, education, and the kind of work a person has done. It’s true that if you’re under 50, the SSA expects you to prove you can't do any job, not just your old one. For example, a former nurse would have to show they couldn’t work a desk job. Over 50, however, the SSA doesn't expect applicants to retrain for new work, just prove they can no longer perform the functions needed for their existing job. In practice, applicants in their early 60s have the highest approval rates of any age group, with an approval likelihood roughly 2-3 times that of a comparable 40-year-old. Age is an advantage in this process, one of the few places in American life where that is true.

In certain circumstances, the two paths can also be combined. A person can claim early retirement at 62 as bridge income while an SSDI application is pending. If SSDI is approved and the disability is found to have begun before the retirement claim, Social Security pays the difference retroactively and removes the early-claiming reduction, as if the person had been on SSDI all along. There are real downside risks to this dual claim approach, though, and anyone considering it should seek professional advice before pursuing.

Specifically, if the SSDI claim is denied, or if Social Security finds the disability began after the retirement claim was filed, the reduced retirement benefit is locked in for life. The main escape hatch, withdrawing a retirement application within 12 months, requires repaying every dollar received, and disability decisions frequently take longer than 12 months. The order of filings, and the disability onset date alleged, can be worth tens of thousands of dollars. This is exactly why it pays to get the strategy right before filing anything.

If you are leaving work because of your health

The following is general information. Individual outcomes depend on each person's medical facts and earnings record. But a few principles apply broadly:

• Evaluate SSDI before you claim early retirement. Once you understand what your full benefit would be and whether your condition may qualify, you can make an informed retirement decision.

• An SSDI denial is not the end. Initial denials in the SSDI process are common, appeal deadlines are strict, and many claims that lose at first succeed on appeal. Legal representation can help at every stage.

• Already claimed early retirement? You may still have options. People ages 62 to 66 receiving early retirement who have a qualifying health condition should have their situation assessed promptly, because SSDI can still be worth pursuing before full retirement age.

Anyone weighing these choices should consult the Social Security Administration or a qualified representative before acting.

Where Atticus fits in

Atticus helps people evaluate the strength of a potential SSDI claim before they file, including people considering filing for early retirement and SSDI at the same time. The advice is free, there are no upfront fees, and clients do not pay an attorney fee if they lose. Getting an honest read on a claim before filing anything is the single cheapest form of insurance available in this process.

Methodology

Atticus surveyed 250 U.S. adults over age 60 who currently receive Social Security early retirement benefits and who reported leaving the workforce for health-related reasons (physical health, mental health, or a mix of both). The survey was fielded online in September 2026. Respondents were 55% female and 45% male, came from all major U.S. regions, and 67% reported household income under $50,000. Two thirds (65%) began receiving early retirement benefits at age 62. Percentages are rounded and may not sum to 100. 

Questions about reasons for not applying for SSDI and about whether respondents would have decided differently were asked only of the 159 respondents who reported never applying for SSDI. Full question wording and topline results are available on request.

* Entitlement begins after a 5-month waiting period, counted from the date SSA determines your disability began (the "onset date"). Therefore, Medicare generally begins 29 months after the disability onset date.  + Up to 50% of the recipient’s benefit per family member, subject to the family maximum. ^ The early retirement cut also flows through to spousal, widow, and dependent benefits calculated from the worker's record.