I got a call this week from a former client. Social Security had contacted him when he turned 62. They told him he needed to come to their local office and apply for early retirement. The client called me to ask if Social Security really could force him to apply for retirement. The short answer is: Yes
When on SSI, You Must Accept Any Other Resources Available To You
When you are on SSI, you are obligated to seek out any other benefits to which you might be entitled. This is because SSI is
a poverty program and thus the “payor of last resort.” SSI beneficiaries have to lessen what Social Security owes them by any means possible. Since Social Security is responsible for both SSI and retirement, they are not going to let this one slip by.
You Cannot Get Retirement Benefits Unless You Are Eligible
There are a few things to keep in mind. First, you have to be eligible for retirement before this applies. A person most commonly becomes eligible for Social Security retirement by earning 40 quarters. This is the equivalent of working for 10 years. If you never reached this status, then Social Security cannot force you into retirement. It is pretty rare for anyone not to qualify for Social Security retirement, however. This would mean that by age 62 you failed to work 10 years anywhere at any time.
Your Monthly Check Could Turn Out To Be The Same
Note also that the difference in what Social Security pays you each month after forcing you into retirement could be more money. You may be entitled to a higher monthly check as a retiree than you are as an SSI recipient. But, if your retirement benefit is less than your SSI check, you will likely continue to get the same amount. You might now get two checks, one from retirement and one from SSI. The total should still be the same.
Social Security goes through this song and dance because retirement and SSI have different funding sources. Thus it is important to Social Security that your monthly benefits draw from the right place.
Going On Early Retirement Could Cost You Your Health Insurance
Naturally, there are some serious risks involved. Your retirement amount may be too high for you to qualify for Medicaid any longer. There is nothing you can do about that. You also lose the right to retire at your full retirement age, which would mean higher benefits for the rest of your life.
Contact Social Security As You Turn 62
If you are on SSI and approaching your 62nd birthday, get in touch with Social Security to see what needs to be done. Because this switch over is mandatory, you could get in trouble for not doing it promptly.
As always, I welcome your questions or concerns.
