It’s 2025 and there’s an important change in Social Security that you should be aware of: the Full Retirement Age (FRA) is shifting. This change could impact your retirement plans, so it’s essential to understand what’s happening and how it might affect you.
What is Full Retirement Age (FRA)?
Full Retirement Age is the age at which you are entitled to receive your full Social Security retirement benefits. The FRA has been gradually increasing for people born after 1937, and it will continue to do so in 2025.
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What’s Changing in 2025?
Starting in 2025, the Full Retirement Age will be rising. Here’s a simple breakdown:
- For people born in 1960 or later, the FRA will gradually increase from 66 and 10 months to 67.
- If you were born between 1955 and 1959, your FRA ranges from 66 and 2 months to 66 and 10 months.
Why is the FRA Changing?
The change in FRA is part of a long-term plan to ensure the sustainability of the Social Security program. As people are living longer, raising the FRA helps to balance the number of years people receive benefits with the funds available.
How Does This Affect You?
- Planning Your Retirement: If you plan to retire at your FRA, you will need to adjust your retirement timeline according to the new age requirements. You may want to read this blog from Bankers Life, part of our family of brands, 7 Saving Strategies for a Secure Retirement
- Early Retirement: You can still choose to retire as early as age 62, but your benefits will be reduced more significantly if your FRA is higher.
- Delayed Retirement Credits: If you delay your retirement past the FRA, you can earn delayed retirement credits, which increase your benefits.
Check out our blog, Should You Use Life Insurance for Retirement Planning?
What Should You Do?
- Review Your Retirement Plan: Make sure your retirement plan accounts for the new FRA.
- Consult a Financial Advisor: It’s always a good idea to discuss your retirement plans with a financial advisor who can provide personalized advice.
- Stay Informed: Keep yourself updated on any further changes to Social Security regulations.
By understanding these changes, you can better plan for your retirement and make the most of your Social Security benefits.
Want more? You may want to read our blogs, How Life Insurance Can Help Ensure Financial Security and Worried About Outliving Your Money? Long-Term Care May be the Answer
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