The definition of Full Retirement Age (FRA) is the age at which you are eligible to receive the full amount of Social Security benefits. The Full Retirement Age depends on the day and year you were born.
Definition and Example of Full Retirement Age
Full Retirement Age is the age at which you can receive full and unreduced Social Security benefits. If you start receiving benefits before reaching Full Retirement Age, those benefits will be reduced.
Alternate Name: Normal Retirement Age
For example, if you begin to collect benefits at age 62, the earliest age you can start receiving them, you may see a reduction of up to 30% in your full benefits. If you delay your benefits until after Full Retirement Age, your benefits will increase due to delayed retirement credits. These credits can increase your benefits by up to 8%.
How Does Full Retirement Age Work?
Full Retirement Age is not the same age for everyone. Understanding when you will reach Full Retirement Age depends on the day and year you were born.
Although the Full Retirement Age was previously 65 for everyone, Congress passed a law in 1983 that gradually increases the Full Retirement Age to 67, as people are living longer.
Full Retirement Age depends not only on the year you were born but also on the day, because Social Security considers you to have reached the age the day before your birthday. Therefore, if you were born on January 1, it will use the Full Retirement Age from the year before your birth year.
For example, if someone was born on January 1, 1956, they will use 1955 as the year to calculate their Full Retirement Age, as they will be considered to have reached the age (in this case, 66) on December 31 of the previous year (1955). According to the Social Security Administration, the Full Retirement Age for those born in 1955 will be 66 years and 2 months; thus, this is their retirement age, even if they were actually born in 1956.
Note: For the month you are eligible to receive benefits, if you were born on the first of the month, it is considered that you reached that age in the previous month. A person born on February 1 will be eligible to receive their benefits in January.
If you are applying for widow or widower benefits, the earliest age you can receive these benefits is age 60, at which point you will receive a reduced benefit.
For example, anyone born anytime from 1945 to 1956 will reach Full Retirement Age for survivor benefits at age 66.
If you take Social Security benefits before reaching Full Retirement Age and you earn income exceeding the annual earnings limit, your Social Security benefit will be reduced. Once you reach Full Retirement Age, you can earn as much as you want, and your Social Security benefit will not be reduced.
Note: Social Security is separate from Medicare. Although age 65 is often referenced when talking about Medicare, Full Retirement Age may be something different.
For couples, in many cases, if the higher-earning spouse waits until Full Retirement Age or later to begin benefits, it can lead to a significant increase in survivor benefits. If you are married, be sure to coordinate your claiming decision to put both of you in the safest position.
Sources
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Administration
Social Security. “Early or Late Retirement”. Accessed December 6, 2020.
Social Security Administration. “Starting Your Retirement Benefits Early”. Accessed December 6, 2020.
Social Security. “Retirement Age Calculator”. Accessed December 6, 2020.
Social Security Administration. “§ 404.102. Definitions”. Accessed December 6, 2020.
Social Security Administration. “What You Need to Know When Considering Retirement or Survivor Benefits”. Page 1. Accessed December 6, 2020.
Social Security Administration. “If You Are the Survivor”. Accessed December 6, 2020.
Social Security Administration. “Full Retirement Age for Survivors Born Between 1945 and 1956: 66”. Accessed December 6, 2020.
Social Security Administration. “§ 404.313. What is Delayed Retirement Credit and How Does it Increase Your Lifetime Benefit Amount?”. Accessed December 6, 2020.
Source: https://www.thebalancemoney.com/full-retirement-age-benefits-2388831
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