One of the most common questions I receive as a Financial Planner is “when should I take social security?” . This question has many different answers for many different situations. However, one of the most important factors in the answer is knowing what and when is your full retirement age.
Historically, the full retirement age, as defined by the Social Security Administration, was age of 65. Retirees could take less for benefits at age 62 up to age 65. Once they received age 65 they became eligible for government subsidized healthcare (Medicare) and their full retirement social security benefits. As the population of claimants grew and people began living longer, the SSA needed to stretch the Pension Fund. The age claimants achieved to receive their full pay was pushed up. Depending on when a person is born dictates what age determines full retirement age.
The new retirement point is more complex. Review the chart as prepared by the Social Security Administration to state the current full retirement band age
Age To Receive Full Social Security Benefits
(Called “full retirement age” or “normal retirement age.”)
|Year of Birth*||Full Retirement Age|
|1937 or earlier||65|
|1938||65 and 2 months|
|1939||65 and 4 months|
|1940||65 and 6 months|
|1941||65 and 8 months|
|1942||65 and 10 months|
|1943 – 1954||66|
|1955||66 and 2 months|
|1956||66 and 4 months|
|1957||66 and 6 months|
|1958||66 and 8 months|
|1959||66 and 10 months|
|1960 and later||67|
*If you were born on January 1st of any year you should refer to the previous year. (If you were born on the 1st of the month, we figure your benefit (and your full retirement age) as if your birthday was in the previous month.)
Determining your full retirement age according to the SSA will assist you in best planning when to retire and when to begin accepting your benefit. Taking social security prior to your full age may result in less income per month for life. Individuals do not need to trigger social security benefits at full age, waiting until up to age 70 may increase their monthly lifetime payments. Determining when to take the income is an individualized decision. Meet with a reputable Financial Planner is advisable in order to make the right choice.
Written by Helen Hartman, Chartered Retirement Planning Counselor (CRPC®) and Professional Plan Consultant (PPC®), of Redwood Financial Network in Solon, Ohio.