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Warning: This Social Security Full Retirement Age Trap Could Snare You

By Dan Caplinger – Oct 3, 2020 at 12:04PM

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You might not be eligible for full benefits exactly when you think.

More than 60 million Americans get Social Security payments right now. Tens of millions more expect to file for benefits in the coming years. The money they'll get from the program is vital for their financial survival.

When it comes to how much you'll receive in benefits, a lot depends on what your full retirement age is. Claim before that age, and you'll have to accept a smaller monthly check. For many, that's a big incentive to wait.

However, it's easy to get confused about just how long you have to wait. In particular, your full retirement age depends on exactly what kind of benefits you expect to get from Social Security.

Blue Social Security card tucked into a spread-out pile of money.

Image source: Getty Images.

The rule for retirement benefits

Many Americans still mistakenly believe that 65 is the full retirement age. Most people think of 65 as the target for when they expect to retire, and it's true that early in Social Security's history, 65 was, in fact, the defined age to receive full retirement benefits.

Changes to the law in the early 1980s pushed the retirement age higher. Beginning with those born in 1938, you had to wait past age 65 to get full retirement benefits.

For those born between 1943 and 1954, 66 became the full retirement age. For each birth year between 1955 and 1959, two months get added to the full retirement age. Those born in 1960 or later have to wait until age 67 to get a full-sized Social Security check as a retiree.

Different full retirement age for survivor benefits

All the information above is for those receiving retirement benefits based on their own work histories. It'd be natural to assume that if you're receiving survivor benefits based on a deceased spouse's work history, you'd have the same retirement age. That assumption would be wrong.

The rules governing full retirement age for survivor benefits are distinct from the retirement benefit rules. The full retirement age schedule gets pushed back two years.

Here's how it works. Instead of those born between 1943 and 1954 having a full retirement age of 66, survivors born between 1945 and 1956 have it. Those survivors born from 1957 to 1961 have full retirement ages ranging from 66 and two months to 66 and 10 months. Only from 1962 onward do full retirement ages for survivors rise to 67.

Why it matters

The net impact of the different rules pushes full retirement ages for survivors lower by two or four months for those born between 1955 and 1961. With those folks turning 59 to 65 in 2020, the question of when to retire is fast approaching.

Two to four months isn't a huge amount of time, but the boost to your benefits can be meaningful. For someone eligible to get the average survivor benefit of $1,226 per month, the lower full retirement age can add $16 to $33 to your monthly payment. That boost lasts for the rest of your life. Alternatively, you can take the benefit sooner and get two to four extra monthly payments.

Social Security  plays a key role in nearly every American's financial planning for retirement. The rules aren't always easy to understand, especially when it comes to differences between your own retirement benefit and those that loved ones are entitled to receive after your death. Knowing the ins and outs of those rules, however, can help you make better choices and get more from your Social Security coverage.

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