In 1983, Congress passed legislation designed to strengthen the long-term financial stability of the Social Security system. As part of that effort, the law gradually increased the full retirement age, which is the age at which workers can receive 100% of their Social Security retirement benefits.
What will the full retirement age be in 2027?
Workers become eligible to claim Social Security retirement benefits as early as age 62. However, claiming benefits at that age results in a permanently reduced monthly payment. The Social Security Administration (SSA) recommends waiting until full retirement age to receive unreduced benefits.
A worker’s full retirement age depends on their year of birth. For individuals born between 1943 and 1954, the full retirement age is 66. For those born between 1955 and 1959, the full retirement age gradually increases. Individuals born in 1959 have a full retirement age of 66 years and 10 months.
For people born in 1960 or later, the full retirement age is 67. As a result, individuals born in 1960 will become eligible to receive their full Social Security benefits in 2027.
The impact of claiming Social Security before full retirement age
Although workers can begin collecting Social Security benefits at age 62, doing so reduces their monthly payments because full benefits are only available once they reach full retirement age.
For example, a beneficiary whose full retirement age is 67 would receive 30% less per month if they claim benefits at age 62. If their full retirement benefit would be $1,000 per month at age 67, claiming at age 62 would reduce that amount to $700 per month.
On the other hand, workers who delay claiming benefits beyond their full retirement age can increase their monthly payments.
According to the Social Security Administration, retirement benefits increase by approximately 8% for each year a person delays claiming benefits after reaching full retirement age, up to age 70. For someone whose full retirement age is 67, waiting until age 70 to claim benefits would result in a 24% increase in their monthly payment.
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