What is your social security age?

The age at which you become eligible for Social Security depends on the year you were born. See when you'll be eligible, and why it may make sense to wait longer to retire.

  • Facebook.
  • Twitter.
  • LinkedIn.
  • Google Plus
  • Print

A recent survey showed that 71% of Americans don't know what the normal, or full retirement age is for Social Security. And, many people don't realize that they can choose when to begin receiving benefits, or what that choice means to their monthly Social Security checks. With that in mind, here's what all Americans should know about the Social Security age, and what it means to you.

What's your normal retirement age? It depends...

There is no single normal retirement age for Social Security—rather, it varies, depending on when you were born. Most Americans (incorrectly) believe it to be 65. For people retiring now (2015), and those born in 1954 or earlier, full retirement age is 66 years old. Two months is added to the normal retirement age for people born every year after, until 1959. For those born in 1960 or later, full retirement age is 67 years old. That may sound a little confusing, so here's an easy-to-read chart.

If you were born in...

Your normal (full) retirement age is

1943-1954

66

1955

66 years, 2 months

1956

66 years, 4 months

1957

66 years, 6 months

1958

66 years, 8 months

1959

66 years, 10 months

1960 or later

67

Source: Social Security Administration.

Regardless of your normal retirement age, you can choose to collect benefits as early as age 62, or wait until as late as age 70. Your benefit will be reduced if you choose to collect early, and increased if you choose to wait.

For collecting benefits early, the amount is reduced by 6.7% for the first three years before you reach full retirement age, and by 5% for each year beyond that, all the way down to 62. In other words, if your full retirement age is 67, and you choose to collect benefits at age 62, your monthly checks will be 30% less than they would have been (three years at 6.7% and two years at 5%).

On the other hand, your benefit will increase by 8% for every year you choose to delay beyond your normal retirement age. So, if your full retirement age is 67 and you wait until 70, your Social Security checks will be 24% larger. And, the increase (or decrease) in benefits is prorated for partial years. For example, if you file for benefits at age 69.5, you can expect a 20% increase (two and a half years times 8%).

The cost of early benefits and the reward for delaying

To illustrate this, here's what you can expect your Social Security benefits to be based on your normal retirement age and when you choose to begin collecting.

If you choose to collect benefits at age...

And your full retirement age is 66

And your full retirement age is 67

62

75% of your full benefit amount

70%

63

80%

75%

64

86.7%

80%

65

93.3%

86.7%

66

100%

93.3%

67

108%

100%

68

116%

108%

69

124%

116%

70

132%

124%

If your normal retirement age happens to fall between 66 and 67, the reduction or increase in benefits for collecting early or late will be adjusted accordingly. For example, if your normal retirement age is 66, and you choose to delay benefits until 68, it will have the same effect as if your normal retirement age is 66 years and four months, and you delay until 68 years and four months.

It's also worth mentioning that you aren't necessarily being penalized for collecting early, nor are you rewarded for delaying your benefits. In theory, you'll receive the same amount of money over the course of your retirement regardless of when you choose to collect benefits.

The takeaway

Knowing when you can file for Social Security and how much you can expect depending on when you file is great information to have when planning for retirement. By incorporating your expected Social Security benefits and the age at when you plan to file into your retirement planning, you can formulate a better idea of how much you need to save, and how much risk you can afford to take with your investments.

Topics:
  • Facebook.
  • Twitter.
  • LinkedIn.
  • Google Plus
  • Print
Photo credit: Flickr user Eugene Peretz
Fidelity does not provide legal or tax advice. The information herein is general in nature and should not be considered legal or tax advice. Consult an attorney or tax professional regarding your specific situation.
This article was written by Matthew Frankel from The Motley Fool and was licensed as an article reprint. Article copyright July 12, 2015 by The Motley Fool.
The statements and opinions expressed in this article are those of the author. Fidelity Investments cannot guarantee the accuracy or completeness of any statements or data.
This reprint is supplied by Fidelity Brokerage Services LLC, Member NYSE, SIPC.
The third party provider of the reprint permission and Fidelity Investments are independent entities and not legally affiliated.
The images, graphs, tools, and videos are for illustrative purposes only.
Fidelity Brokerage Services Member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917
730926.1.0
close
Please enter a valid e-mail address
Please enter a valid e-mail address
Important legal information about the e-mail you will be sending. By using this service, you agree to input your real e-mail address and only send it to people you know. It is a violation of law in some jurisdictions to falsely identify yourself in an e-mail. All information you provide will be used by Fidelity solely for the purpose of sending the e-mail on your behalf.The subject line of the e-mail you send will be "Fidelity.com: "

Your e-mail has been sent.
close

Your e-mail has been sent.

Here's what we suggest you explore next

Just 1% more can make a big difference

Putting just 1% more of your salary each month into a tax-advantaged retirement account like a 401(k), 403(b), or IRA could make a noticeable difference.

Open a Fidelity IRA and get more than tax benefits

Free investment help. Exceptional service. Range of investment choices.

You might also like

5 easy ways to boost your credit score 100 points

Do you have a low credit score? This article outlines 5 easy ways to boost your credit score by 100 points.

Just 1% more can make a big difference

Putting just 1% more of your salary each month into a tax-advantaged retirement account like a 401(k), 403(b), or IRA could make a noticeable difference.

5 of the biggest investment mistakes to avoid

Investing smart is not easy. This article outlines five of the biggest mistakes you can avoid while investing.

Start budgeting: Meet Cinch

Introducing CinchSM from Fidelity, a simple way to track your saving and spending. Just answer a couple of questions to get started.