What happens to benefits for individuals who retire early at age 62?

When individuals choose to retire early at age 62, their Social Security benefits are reduced to reflect the fact that they are claiming their benefits before reaching their full retirement age (FRA). The primary insurance amount (PIA) is the benefit amount individuals would receive if they claim at their FRA. Claiming benefits early results in a permanent reduction in the monthly benefit amount.

Specifically, for those who retire at age 62, the reduction is generally about 25-30% of the full benefit amount, depending on the year of birth and the specific FRA set by Social Security. This makes the statement regarding benefits being adjusted to 80% of the PIA a reasonable approximation, understanding that actual percentages vary based on specific circumstances and rules.

Retiring before the designated FRA leads to lower lifetime benefits, which is a calculated decision individuals must weigh against their immediate financial needs and health status. The other options do not accurately represent the effects of early retirement; benefits do not remain at 100% of the PIA, are not delayed, and the PIA is not recalculated in this context.