The Social Security Early Retirement Benefit as a Safety Net

The Social Security Early Retirement Benefit as a Safety Net

Abstract

This paper examines the health and economic status of those who collect Social Security retirement benefits prior to the full retirement age. It uses a propensity score reweighting method to estimate the fraction who use early retirement benefits as a safety net against deteriorating health and who might be induced to apply for disability benefits (SSDI) or retire without income replacement if the generosity or availability of early retirement benefits were reduced. About one in five early retirees have health characteristics similar to SSDI beneficiaries, and thus might not be able to replace losses in benefit income with labor income.

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