Your Social Security Full Retirement Age
For anyone born in 1960 or later, including those born in 1964, the Social Security Administration sets the full retirement age (FRA) at 67. Reaching this age makes you eligible for 100% of your primary monthly Social Security benefit. The FRA was increased from 65 to 67 gradually for individuals born in 1938 and later, becoming 67 for those born in 1960 and beyond.
Early Retirement Option: Starting at Age 62
Individuals born in 1964 have the option to begin collecting Social Security retirement benefits as early as age 62. This choice may be influenced by factors such as needing income sooner or a desire to retire early. However, claiming benefits at age 62 results in a permanent reduction in your monthly Social Security check, potentially by up to 30%, compared to the amount you would receive at your full retirement age of 67. The reduction amount is determined by the number of months you receive benefits before reaching your FRA. The earlier you claim, the greater the reduction. The initial benefit amount at age 62 will be the basis for all future cost-of-living adjustments.
Considerations for early retirement:
- Permanent Reduction: The reduced monthly benefit is permanent.
- Dependent Benefits: Claiming early may also reduce benefits for a spouse or dependents claiming on your record.
- Shorter Life Expectancy: Early claiming might be more beneficial for individuals with a shorter life expectancy.
Delayed Retirement Option: Waiting Beyond Age 67
Delaying retirement past the full retirement age of 67 can increase your monthly Social Security payments through delayed retirement credits. These credits accrue annually until you reach age 70, at which point the monthly benefit no longer increases.
For someone born in 1964, delaying benefits until age 70 could result in a monthly payment that is 24% higher than the benefit received at age 67. This can provide a significant and consistent increase in retirement income.
The potential benefits of delaying retirement:
- Higher Monthly Payments: A significantly larger monthly check for life.
- Survivor Benefits: A higher monthly benefit could mean a larger survivor's benefit for a surviving spouse.
- Financial Security: It can provide extra financial cushioning, especially if you have a longer life expectancy.
Comparing Social Security Retirement Ages for 1964 Birth Year
Understanding the financial differences between retirement ages is key. Here's a comparison:
| Retirement Age | Benefit Amount for a $1,000 FRA Benefit | Key Advantage | Key Disadvantage |
|---|---|---|---|
| 62 (Early) | $700 (30% reduction) | Receives income sooner | Significant, permanent reduction |
| 67 (Full) | $1,000 (100% of benefit) | Receives full, unreduced benefit | Must wait longer to start collecting |
| 70 (Delayed) | $1,240 (124% of benefit) | Maximum possible monthly payment | Must delay income for several years |
The Role of Personal Savings and Other Retirement Accounts
Social Security is a foundational element of retirement income but is often insufficient on its own. For someone born in 1964, incorporating personal savings, investments, and other retirement accounts like 401(k)s or IRAs into your financial plan is essential. These can supplement your Social Security benefits and provide flexibility, such as covering expenses if you retire from work before claiming Social Security.
Conclusion
If you were born in 1964, your options for when to retire with Social Security include claiming early at 62 with a reduced benefit, receiving your full benefit at age 67, or delaying until 70 for the maximum possible monthly payment. Your personal financial situation, health, and desired retirement lifestyle are crucial factors in making this decision. Consulting a financial advisor can help you navigate these options to best meet your retirement goals.
