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When planning for retirement, one of the most important factors to consider is the age at which full Social Security benefits can be accessed. For years, it was assumed that the standard age was 65, but the reality has changed with a recent update.
From 2025, this figure will rise for a specific group of the population, raising questions and even confusion among those approaching this stage of life. Understanding this adjustment, although small, is crucial to making informed decisions and ensuring financial stability in old age.
What will the new Social Security retirement age be?
The increase in the full retirement age is not a new measure. It is part of a long-term plan set out in the 1983 Social Security Amendments
This adjustment directly impacts people born in 1959. For this group, the full retirement age (FRA) has been set at 66 years and 10 months. Those born in 1960 or later will have to wait until age 67 to claim their full, unreduced benefits.
What happens if you retire before full retirement age?
For those who opt for early retirement, claiming their benefits at age 62, the change in FRA is significant. For those born in 1959, early retirement will result in a 29% reduction in their monthly benefits. For those born in 1960 or later, this reduction is even greater, reaching 30%.
Recommendations for early retirement
If a person wishes to take early retirement, the authorities make the following recommendations:
- Withdraw from taxable accounts.
- Keep your modified adjusted gross income low.
- Side hustles: If you need extra income, consider side jobs.