There is a reduction in benefits when applying for Social Security benefits before full retirement age. There are penalties for both primary beneficiaries and spouses taking early retirement, according to the Social Security Administration.
Early retirement penalties are applied based on how far in advance the beneficiary applies for Social Security benefits, explains the SSA. As of 2015, there is a decrease in benefits of 5/9 of one percent for each month before full retirement age, up to 36 months, and 5/12 of one percent for every additional reduction month. Retiring at age 62 may result in a benefit cutback of up to 30 percent.
Delayed retirement credits are given to people who choose to retire later than their normal retirement age, states the SSA. These credits increase the retiree's payments. Credits can be earned through age 69 and may increase payments by up to 8 percent per year, depending on the applicant's date of birth.