Starting in 2025, millions of Americans will experience a significant change in Social Security. People born in 1960 or later will no longer receive full retirement benefits at age 65. The new full retirement age (FRA) has been set to 67 for this group, marking the final phase of a series of changes passed decades ago. This shift is part of a gradual increase in the FRA that started in the mid-1980s. Here’s what this means for your retirement planning.
What Changed and Why?
Previously, individuals could start collecting full Social Security benefits at age 65. However, due to longer life expectancies and concerns about the financial sustainability of the Social Security system, Congress decided to raise the FRA. This change started with those born in 1955 and continues with those born in 1960. The changes over the years were as follows:
- Born in 1955: FRA is 66 years and 2 months
- Born in 1956: FRA is 66 years and 4 months
- Born in 1957: FRA is 66 years and 6 months
- Born in 1958: FRA is 66 years and 8 months
- Born in 1959: FRA is 66 years and 10 months
- Born in 1960 or later: FRA is 67 years
For people born in 1960, 2025 will be the first year they need to wait until age 67 to collect their full Social Security benefits.
You Can Still Retire at 62 – But It’ll Cost You
Although the FRA has been raised, you still have the option to start collecting Social Security benefits at age 62. However, doing so will result in a significant reduction in your monthly benefits. The reduction is about 30%. For example, if you are eligible to receive $1,000 per month at age 67, you would only receive $700 per month if you start at age 62.
On the other hand, if you choose to wait until age 70, your monthly benefits will increase by about 24%. So, a $1,000 benefit at 67 would grow to $1,240 at 70.
This Is the Final Scheduled Increase – For Now
The increase to 67 is the last scheduled change under the 1983 amendments to the Social Security Act. However, the future of Social Security is uncertain. In 2025, the House Republican Study Committee proposed further increases in the retirement age, as life expectancy continues to rise. Although no new official age has been set, there are discussions about raising the FRA even further in the future.
Why the FRA Was Raised
The reason for raising the FRA is clear. People are living longer, which means they are collecting benefits for more years. At the same time, the Social Security system is facing financial challenges. According to the 2024 Social Security Trustees Report, the Social Security retirement trust fund could be depleted by 2033. If that happens, benefits could be cut to 77% of their current value, unless Congress makes changes.
A Political Divide on Solutions
How to fix Social Security has become a deeply partisan issue. Republicans generally advocate for raising the retirement age to help extend the life of the Social Security system. Democrats, on the other hand, prefer increasing revenue by taxing higher-income earners. One proposal, the Social Security and Medicare Fair Share Act, suggests taxing income over $400,000, which currently isn’t taxed for Social Security purposes.
What You Should Do Now
If you’re nearing retirement, here are some steps you should take:
- Know your FRA: Find out your full retirement age based on your birth year.
- Plan ahead: Understand that early retirement means smaller monthly checks.
- Stay updated: Watch for any future changes to Social Security laws.
- Consider health and finances: Take into account your health and financial situation when deciding when to retire.
The shift from 65 to 67 for full Social Security benefits is now official for millions of Americans. If you were born in 1960 or later, you will need to wait until age 67 to receive your full retirement benefits. This change emphasizes the need for careful planning as you approach retirement. Make sure to stay informed about future changes to the Social Security system, as they could affect your retirement income.
FAQs
What is the full retirement age for Social Security now?
For people born in 1960 or later, the full retirement age is now 67. This means you must wait until you are 67 to receive full Social Security benefits.
Can I still retire at 62 and collect Social Security benefits?
Yes, you can still begin collecting Social Security benefits at age 62, but your monthly benefits will be reduced by about 30%.
Why did the full retirement age increase?
The full retirement age was raised due to longer life expectancies and concerns about the sustainability of the Social Security system. More people are living longer, meaning they collect benefits for a longer period.
What happens if I wait to collect Social Security until age 70?
If you wait until age 70 to collect Social Security, your monthly benefits will increase by about 24%, compared to starting at your full retirement age.
Is this the final change to Social Security benefits?
The increase to 67 is the last scheduled change under the 1983 law. However, there may be future increases depending on how Congress addresses Social Security’s long-term funding issues.
Thank for the update on our Social Security system.