For those persons who are getting Supplemental Security Income (SSI), turning 62 is an important event. This is because Social Security is supposed to stop SSI and switch such beneficiaries over to retirement benefits.
Retirement Benefits Must Be Taken When Available
The thinking here is straightforward: Social Security reduces SSI benefits by almost any other income the beneficiary has. At age 62, a person can put in for Social Security retirement. Social Security transfers people into
retirement at 62 so as to get them off of SSI. It might seem like an odd thing to do, but SSI is a general obligation of the US Treasury but retirement is paid from Social Security's trust fund.
Social Security Does Not Always Make The Switchover
Here is why you want to check to ensure that Social Security has taken you off of SSI and put you onto retirement at age 62: many times they simply don't do it. An audit showed that up to one-quarter of SSI beneficiaries were not switched over to retirement. Per this audit, Social Security underpaid the would-be retirees by as much as five million dollars, cumulatively.
A Couple of Exceptions
There are a few caveats here. First, the transition to retirement can only happen if the SSI beneficiary qualifies for retirement benefits. Many do not. Second, to avoid paying the early-retirement penalty at age 62, a person would need to go off of SSI before that age and then apply for retirement anywhere up to age 70.
Contact Social Security When You Reach 62
If you are getting SSI and approaching age 62, contact Social Security to see what your options are. There are millions of dollars being left on the table every year. Some of that could belong to you.