For the first time in 6 years, retirement age isn’t changing

Saving money for retirement is important, but so is paying off debt. So which should you prioritize?

This year marks the first time in six years that full retirement age won’t change.

You can start using your Social Security benefits at age 62, however, you won’t get the most out of your benefits. Waiting until your full retirement age will maximize the Social Security benefits you’ll receive.

Full retirement age is based on your birth year, but for those who turn 62 during or after 2022, your full retirement age will be 67. In 1983, Congress made changes to the full retirement age so that funds wouldn’t run out from the program, according to Fox Business News.

Previously, the full retirement age has increased by two months each year, and this will be the first time in six years where the full retirement age will not change. Congress could make more changes to the full retirement age and shift it further up; however, unless that happens, the full retirement age will stay at 67.

For those who turned 62 before 2022, your retirement age might be different. According to the Social Security Administration, full retirement age for individuals, based on their birth year is:

1943-1954: 66

1955: 66 and two months

1956: 66 and four months

1957: 66 and six months

1958: 66 and eight months

1959: 66 and ten months

1960 and later: 67

Everyone born after 1960 will be able to maximize their full Social Security benefits at age 67.

If you start receiving Social Security benefits at 62 you could lose up to 30% of your benefits. The closer you are to your full retirement age, the more that percentage will shrink. Once you reach 67, you will get 100% of the benefits, so there is no financial incentive to wait to collect Social Security after your full retirement age.

For those who’ve retired early due to the COVID-19 pandemic, stimulus payments have been helpful, allowing some early retirees to delay collecting their Social Security until their full retirement age, GOBankingRates reported. Even though retirement during COVID doubled, the number of people who claimed Social Security benefits declined by 5%, according to an analysis by the Washington Post.

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