One of the myths surrounding Social Security is that it can and should be claimed when a person reaches the age of sixty-five, the standard retirement age in much of the Western world.

This rumor is not true. The Social Security Administration, which is responsible for making the payments, establishes a “full retirement age” (FRA) for all Americans, according to the year of their birth date. For Americans born before the year 1960, this age is sixty-six and some number of months, increasing as the birth year approaches 1960. For Americans born in 1960 or later, the age is sixty-seven, and there is a strong likelihood that it will grow older still as successive generations claim Social Security. This will be the case, of course, only if Social Security still exists in its current form; it has been well-documented that the agency’s trust fund is slowly running out of money.

The fund’s longevity is helped along, though, by the large number of Americans who claim their benefits before reaching FRA age. According to the Social Security Administration’s own data, around half of men in the United States claim their benefits at age sixty-two, the earliest possible age, and roughly two-thirds end up claiming them before they reach FRA age. In doing so, retirees accept a substantial penalty—around 30 percent of one’s monthly benefits, if claimed at age sixty-two—in exchange for a few years of extra payments up front. In the long run, assuming a person lives to a reasonable age, this will result in a significant loss of savings.

There are several reasons that one might choose to file for benefits early, and the choices were the subject of a recent paper by a USC professor. The result found that there were a number of motivations behind claiming the benefits early, including poor health, the desire to retire early, and concerns of unemployment. However, per the paper, the majority of early applicants were simply poorly informed about the nature of claiming the benefits too early, or were impatient to claim their rewards.

Economically speaking, the most sound decision if one expects to live into one’s mid-eighties is to claim the benefits at age seventy. While claiming benefits before a person reaches the FRA age results in a substantial decrease, conversely, waiting beyond FRA—up to age seventy—gives a substantial increase of roughly 30 percent extra per month. In the long run, this is the best decision, as long as a person can expect to live a reasonably long life.

The bottom line is that education about Social Security, as well as comparisons about how much money can be earned by changing different variables, is essential for retired Americans’ financial health—and, if the USC paper’s conclusions are correct, is sorely lacking in the United States today.

Trevor Filseth is a current and foreign affairs writer for the National Interest.

Image: Reuters.