A significant shift is coming to retirement planning in the United States. Starting in 2026, the Social Security Administration (SSA) will officially raise the full retirement age (FRA) from 67 to 68 for individuals born in 1960 and later. This adjustment marks a major change for millions of future retirees and is designed to address the increasing financial pressure on the Social Security trust fund due to longer life expectancy and rising benefit payouts.
What’s Changing and Who’s Affected?
The new rule primarily impacts individuals born in 1960 or after, who will now need to wait until age 68 to receive full Social Security retirement benefits. Those who choose to retire earlier, such as at age 62, will still be allowed to do so, but their monthly benefits will be significantly reduced. People born before 1960 will continue to follow the existing FRA schedule, which currently tops out at age 67.
| Birth Year | New Full Retirement Age |
|---|---|
| Before 1955 | 66 or earlier |
| 1955–1959 | 66 + 2 to 66 + 10 months |
| 1960 or later | 68 (effective from 2026) |
Why Is the Retirement Age Increasing?
The move to raise the FRA is part of a broader effort to sustain the Social Security system, which has faced funding concerns for decades. With more Americans living longer and drawing benefits for extended periods, the SSA is attempting to balance longevity with financial solvency. By gradually increasing the FRA, the government can reduce long-term payouts and help preserve benefits for future generations.
How Will This Impact Retirement Planning?
This change will affect how Americans plan savings, pensions, and healthcare. Those impacted will need to factor in an extra year of work or supplement their retirement income in other ways. Financial advisors recommend starting retirement planning earlier and possibly delaying benefit claims beyond age 68 to maximize monthly payouts. Waiting until age 70 still allows claimants to receive the highest possible Social Security benefit, with delayed retirement credits.
What Early Retirees Should Know
Choosing to retire before the new full retirement age remains possible, but monthly benefits will be reduced by up to 30% if taken at age 62. Additionally, working while receiving early benefits could result in temporary reductions if income thresholds are exceeded. This makes it critical for prospective retirees to understand the financial trade-offs of claiming early versus waiting.
The shift in Social Security’s full retirement age to 68 in 2026 is a wake-up call for Americans to reassess their retirement strategies. While the policy change aims to protect the future of the program, it also places more responsibility on individuals to save and plan wisely. If you’re nearing retirement or advising someone who is, it’s time to factor these changes into your long-term financial outlook.
FAQ’s:
1. Will I lose benefits if I still retire at 65?
No, but you will receive reduced monthly benefits if you retire before your full retirement age.
2. Does this change affect Medicare eligibility?
No, Medicare eligibility remains at age 65, regardless of retirement age.
3. Can I still work and collect benefits before 68?
Yes, but if you’re under FRA and earning above a set limit, your benefits may be temporarily reduced.
4. What happens if I wait until age 70 to claim benefits?
You’ll receive increased monthly payments thanks to delayed retirement credits.
5. Are there any exceptions to the new FRA?
Only individuals born before 1960 are exempt from the age 68 rule.
