SOCIAL SECURITY
Fact Sheet
Social Security
Increase in Retirement Age
The Social Security Amendments
of 1983 (H.R. 1900, Public Law 98-21) contained two provisions which
may have an impact on when an individual decides to retire. The
two provisions are an increase in the retirement age that can first
affect individuals retiring in 2000 and an increase in the delayed
retirement credit for those who work beyond full retirement age.
Increase in Retirement Age
- For persons born in 1938 or
later, their Social Security benefit may be affected by a provision
that raises the age at which full Social Security benefits
are payable.
- The age for collecting full
Social Security retirement benefits will gradually increase
from 65 to 67 over a 22-year period beginning in 2000 for those
retiring at 62.
- The earliest a person can
start receiving reduced Social Security retirement benefits will
remain age 62.
Increase in Age for Receiving
Full Social Security Benefits
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 |
- Background
- The 1983 Amendments phased
in a gradual increase in the age for collecting full
Social Security retirement benefits. The retirement age will
increase from 65 to 67 over a 22-year period, with an 11-year
hiatus at which the retirement age will remain at 66.
- The original Social Security
Act of 1935 set the minimum age for receiving full retirement
benefits at 65.
- Congress cited improvements
in the health of older people and increases in average life
expectancy as primary reasons for increasing the normal retirement
age.
- Since the program first began
paying monthly Social Security benefits in 1940 the average
life expectancy for men reaching age 65 has increased nearly
4 years to age 81; for women reaching age 65, their average
life expectancy has increased nearly 6 years to age 84.
- The average age for men retiring
in 1998 was 64. The average age for women retiring in 1998
was 64. In 1998, nearly 69% of men and women retired and started
taking Social Security benefits before age 65.
The earliest a person
can start receiving Social Security retirement benefits will remain
age 62.
- Social Security benefits are
reduced for each month a person receives benefits before full
retirement age.
- For persons whose full retirement
age is 65, a retirement benefit is reduced by 5/9
of 1% for each month of benefits prior to full retirement
age.
- As the age for collecting
full Social Security benefits increases, persons who retire at
age 62 will see a greater reduction in their Social Security benefits.
- For persons whose full retirement
age is age 65 and 2 months or later, a retirement benefit
will be reduced by 5/9 of 1% for each
month up to the first 36 months of benefits before full retirement
age, plus 5/12 of 1% for each month
of benefits in excess of 36 prior to full retirement age.
- Examples:
- Social Security benefits
are reduced by 20% for a person who retires at 62 whose
full retirement age is 65 (born 1937 or earlier).
- Social Security benefits
will be reduced by 205/6% for a
person whose full retirement age is 65 and 2 months (retires
at 62 in 2000).
- Social Security benefits
will be reduced by 25% for a person who retires at 62
whose full retirement age is 66 (born 1943-1954).
- Social Security benefits
will be reduced by 30% for a person who retires at 62
whose full retirement age is 67 (born in 1960 or later).
- Background
- The Social Security Amendments
of 1956 lowered the minimum age for retirement benefits to
62 for women.
- The Social Security Amendments
of 1961 extended the early retirement provision to men.
The new Social
Security Statement:
- Tells a person their full retirement
age and
- Provides a retirement benefit
estimate for age 62, full retirement age, and age 70.
- The age 62 benefit estimate incorporates
the reduction for early retirement.
- The age 70 benefit estimate incorporates
delayed retirement credits.
SSA Press Office 449
Altmeyer Bldg. 6401 Security Blvd. Baltimore, MD 21235
410-965-8904 FAX 410-966-9973
|