Starting in 2025, the full retirement age (FRA) in the United States will be adjusted, impacting millions of workers planning for retirement. This change is part of an ongoing legislative reform aimed at adapting to longer life expectancy and ensuring the financial sustainability of the Social Security system.
Full Retirement Age Increase in 2025
For decades, the full retirement age in the U.S. was set at 65 years. However, as of 2025, individuals born in 1959 will need to wait until 66 years and 10 months to receive their full Social Security benefits. For those born in 1960 or later, the full retirement age will be 67 years. This gradual increase reflects demographic shifts and economic adjustments necessary to maintain the system’s stability.
Workers still have the option to retire early at 62 years old, but doing so results in a permanent reduction in monthly benefits. If an individual with a full retirement age of 67 claims benefits at 62, their payments will be reduced by approximately 30%. Since these payments are spread over a longer period, retirees must carefully consider the financial implications.
Delaying Retirement for Higher Benefits
Choosing to delay Social Security benefits beyond the full retirement age offers financial advantages. For each year benefits are postponed, up to age 70, the monthly payment increases by 8%. This means that by waiting until 70, retirees could receive up to 32% more per month than if they had started claiming at 66 years and 10 months.
To make an informed decision, individuals should evaluate their financial needs, health status, and long-term goals. Additionally, those who continue working beyond their full retirement age will not see reductions in their benefits, regardless of additional income.
Proper planning is essential to maximizing Social Security benefits and securing a financially stable retirement.
