If you are in your 50s, you might be considering retirement. Afterall, you’ve been working for decades and you want to enjoy your golden years!
But the question remains as you consider retirement: What are the pros and cons of retiring at 62, 65, 67 or 70? For many people, the answer depends on more than simply reaching a certain birthday. Your health, finances, lifestyle, Social Security benefits and future plans can all influence the right time to leave the workforce.
Here’s a look at some common retirement ages and what to ponder when you are considering retirement. For most people, 62 is the earliest to begin receiving Social Security retirement benefits. One of the biggest advantages to retiring at 62 is gaining more time to enjoy retirement.
However, claiming Social Security before your full retirement age generally means receiving a reduced monthly benefit. Retiring at 62 may make sense for someone with sufficient savings who wants or needs to leave the workforce earlier.
For generations, 65 has been considered the traditional retirement age. It also has an important connection to Medicare eligibility for most Americans. Retiring at 65 can provide a balance between working longer and having more years of retirement, but you should consider whether your Social Security benefit will be reduced if you claim before your full retirement age.
For people born in 1960 or later, 67 is the full retirement age for Social Security. Waiting until full retirement age allows you to receive your full scheduled retirement benefit.
Continuing to work until 67 can also give you additional time to save and reduce the number of years your retirement savings need to support you.
Waiting until 70 can provide another significant advantage: Delayed retirement credits can increase your Social Security benefit if you postpone claiming beyond full retirement age. The tradeoff is spending more years in the workforce before retirement.
So, what is the best age to consider retirement? There isn’t one retirement age that works for everyone. The right decision depends on your financial resources, expected expenses, Social Security strategy, health, family circumstances and retirement goals
Before choosing a retirement date, consider creating a comprehensive retirement plan that looks at both your current financial situation and your anticipated needs throughout retirement. The best retirement age is ultimately the one that fits your financial circumstances and the lifestyle you want to enjoy.
Do you still have questions about retirement planning options?
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