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You are Here: Home > Blog > Retirement Age for Social Security

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Retirement Age for Social Security

Thursday, October 20th, 2011

When President Roosevelt signed the Social Security Act of 1935 into law, the retirement age for all U.S. workers was 65 to qualify for full Social Security retirement benefits. That’s no longer the case thanks to Social Security’s financial woes, partly from Americans living longer than ever before past the age of 65.

Legislation passed in 1983 stepped up the full retirement age in two-month increments based on birth years. Further strains on the system from a persistently-high unemployment rate and too many baby boomers approaching retirement have spurred talks on Capitol Hill of again increasing the full retirement age; but, for now, the age to qualify for full Social Security benefits still incrementally maxes out at 67. Early retirement age is still 62.

Full Retirement Age

“Full retirement age” is how the U.S. Social Security Administration (SSA) most often refers to the age that qualifies you for full retirement benefits (no reductions). Less often, the SSA refers to it as “normal retirement age” (NRA), a term that the IRS uses regarding pension plans.

To determine your full retirement age according to the SSA, look for your birth year in the list below. If you were born before January 2, 1943, then you were eligible for full retirement benefits at age 65, plus ten or fewer months down to zero.

1943-1954: 66
1955: 66 + 2 months
1956: 66 + 4 months
1957: 66 + 6 months
  1958: 66 + 8 months
1959: 66 + 10 months
1960 or later: 67

For the purpose of full retirement age, people born on January 1 are considered to have been born in the previous year; for example, full retirement age is 66 for a baby boomer who was born on January 1, 1955, as though he or she was born in 1954.

Early Retirement Age

As indicated above, early retirement age (also called “minimum retirement age”) for Social Security benefits is still 62 for all eligible workers. However, there’s still a catch too: If you decide to retire early between age 62 and your full retirement age, then the SSA will permanently reduce your monthly benefits. That’s because you will start collecting your benefits sooner (and hopefully for longer, to a ripe old age).

The earlier your full retirement age officially occurs, then the smaller your permanent benefit reduction will be for early retirement at age 62; in other words, it will amount to about 30 percent if your full retirement age is 67, but it will drop to around 25 percent if it’s age 66.

Your benefit reduction will shrink slightly for each month that you wait to retire early between age 62 and your full retirement age. However, there’s another catch: If you keep working after retiring early, then the SSA will further reduce your benefits if you earn more than a predetermined limit annually.

For example, if you decide to go for early retirement in 2011, then the SSA will reduce your benefits by $1 for each $2 you earn in excess of $14,160, unless you will reach full retirement age by the end of the year; if the latter is the case, then the SSA will reduce your benefits by $1 for every $3 you earn in excess of $37,680.

The annual earnings limits are subject to change for early retirement in 2012 and beyond, but the SSA will eliminate whatever yours is once you reach full retirement age.

Did you know?If you’re forced to retire early because you can longer work due to a disabling health condition, then Social Security disability benefits might be a better deal for you long term than early retirement benefits.

More about Retirement

For more retirement age examples along with much more about about retiring, including retirement planning tools and answers to frequently-asked questions, browse Social Security Online, the official Web site of the U.S. Social Security Administration.

Medicare eligibility still starts at age 65, regardless of your Social Security retirement age. Subsequently, you might also be interested in browsing Medicare.gov, the official government site for Medicare by the U.S. Department of Health & Human Services (HHS). Social Security Online also provides information about the Medicare Program, particularity as it relates to retirement.

Did you know?The SSA announced a 3.6 percent cost-of-living adjustment (COLA) for 2012. The SSA also announced that the maximum income subject to Social Security taxes will increase from $106,800 to $110,100 in 2012. Meanwhile, workers are paying two percent less in 2011 Social Security taxes, thanks to the so-called “tax deal” that President Obama negotiated with Republicans in late 2010. The president’s “jobs bill” (American Jobs Act of 2011) will extend and increase the tax break, if Congress passes that part of the bill intact.

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