Social Security is a federal program that provides income to eligible individuals during retirement, disability, or after a spouse's death. It is one of the most critical factors to consider when planning for retirement, and understanding the full retirement age (FRA) is crucial for making informed decisions.

What is the Full Retirement Age?

The FRA is the age at which seniors can claim Social Security benefits without any reductions to their benefit amount. It is based on the year a senior was born and ranges from 66 to 67 years old. For example, if you were born in 1955, your FRA is 66 years and two months. If you were born in 1960 or later, your FRA is 67 years old.

Claiming Social Security Benefits Early

Seniors can start claiming Social Security benefits as early as age 62, but their benefits will be reduced if they claim before their FRA. The reduction in benefits is based on the number of months before their FRA they claim benefits. For example, if your FRA is 66, and you claim benefits at age 62, your benefit amount will be reduced by 25%.

Claiming Social Security Benefits Late

Seniors can also delay claiming Social Security benefits past their FRA and receive a higher benefit amount. For each year past their FRA they delay claiming benefits, their benefit amount increases by 8% up to age 70. For example, if your FRA is 66, and you delay claiming benefits until age 70, your benefit amount will be 32% higher than if you claimed benefits at your FRA.

Maximizing Your Social Security Benefits

To maximize your Social Security benefits, it's essential to consider your retirement plans and financial goals. Financial coaches can provide personalized guidance and support to help seniors make informed decisions about when to claim benefits and how to coordinate spousal benefits.

Delaying retirement to increase your Social Security benefit can be a smart financial move if you have other sources of income to support you in the meantime. Coordinating spousal benefits to optimize your combined benefits can also help maximize your retirement income.

It's important to keep in mind that claiming Social Security benefits early can result in a permanent reduction in your benefit amount. Before making a decision about when to claim benefits, it's crucial to consider your current financial situation, your retirement plans, and your long-term financial goals.

How a Financial Coach Can Help

Working with a financial coach can provide valuable insights and guidance to help you make informed decisions about your retirement plans. Financial coaches can help you:

1. Evaluate your retirement goals and create a plan to achieve them

2. Develop a budget that balances your current expenses with your future retirement income

3. Optimize your Social Security benefits and coordinate spousal benefits

4. Explore additional retirement income sources such as pension plans, annuities, and investments

5. Navigate healthcare expenses and long-term care options

By sitting down with a financial coach, you can feel confident about your retirement plans and ensure that you are taking steps to achieve your long-term financial goals.

Conclusion

The full retirement age is a critical factor to consider when claiming Social Security benefits. Delaying your benefits past your FRA can result in a higher benefit amount, while claiming benefits early can result in a permanent reduction in your benefit amount. By working with a financial coach, you can make informed decisions about when to claim benefits and how to maximize your retirement income. A financial coach can provide personalized guidance and support to help you achieve your retirement goals and create a plan for a financially secure future.