Recession-hit Seniors Forced to Draw from Social Security Early

Many older Americans who lost their jobs in the recession have been forced to claim their Social Security benefits before they initially planned. About 200,000 more people filed initial claims than the Social Security Administration had predicted in 2009 and 2010. This trend is likely to continue in the near future due to chronic unemployment and underemployment. Seniors have been left with no choice but to draw from Social Security as job prospects have lagged behind those of other age groups. The Government Accountability Office reported that less than a third of those aged 55 – 64 who lost their jobs between 2007 and 2009 had found work by January 2010, compared with 41 percent of people 25 to 54.

An analysis by Richard W. Johnson of the Urban Institute found that 37 percent of older workers who lost their jobs between 2007 and 2011 and could not find work claimed Social Security at age 62. According to the New York Times, drawing from Social Security early may prove to be a stopgap for seniors in the short run, but cuts their long-term benefits by up to 20 – 30 percent per month compared to those who are able to wait until their full retirement age.

“It is such a shame when seniors are forced to draw early from their Social Security because of forces beyond their control,” said Barbara Easterling, President of the Alliance for Retired Americans. “The Alliance will continue to fight so that all seniors can retire with dignity and on a solid financial ground.”

Reprinted from the Alliance for Retired Americans’ Friday Alert.

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