Social Security is a program many retired Americans rely on to make ends meet. For this reason, it's important to understand the program's many rules.
One of the most important rules to familiarize yourself with is the timeline for claiming benefits. Once you turn 62, you can sign up for Social Security at any time. But you won't get your monthly benefits without a reduction until you reach full retirement age.
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A big change, however, is coming to Social Security's full retirement age in 2026. And it's one you need to be aware of if you're thinking of signing up for benefits in the new year.
Make sure to file for Social Security at the right time
Social Security's full retirement age has evolved through the years. Long ago, age 65 was considered full retirement age -- the same age when Medicare eligibility begins.
Decades ago, lawmakers voted to gradually increase full retirement age as a means of making Social Security more solvent. Given that life expectancies were increasing, that change was justified.
For people born between 1943 and 1954, full retirement age for Social Security is 66. For those born between 1955 and 1959, it's 66 and a certain number of months. And for anyone born after 1959, it's 67.
What this means is that people who are turning 66 in 2026 will not reach full retirement age next year. Rather, they won't reach full retirement age until 2027.
If you're turning 66 in 2026 and you claim Social Security next year, you'll face a permanent reduction to your monthly benefits. And that could be problematic if you don't have a lot of retirement savings and you need those monthly benefits to cover your living costs.
In fact, if you expect Social Security to be your primary source of retirement income, you may want to delay your claim beyond full retirement age. For each year you do, up until you reach age 70, your benefits are eligible for an 8% boost.
Will Social Security's full retirement age increase again?
Social Security is once again facing a financial crisis that lawmakers need to solve. If they don't, benefit cuts will be on the table once the program's combined trust funds run out of money.
One proposal that's been floated by some lawmakers is increasing full retirement age to 68 or 69. But that doesn't mean that's guaranteed to happen.
There are other solutions lawmakers can look at that don't involve making changes to full retirement age. These include:
- Raising or eliminating the wage cap that determines what higher earners pay into Social Security each year
- Increasing the Social Security tax rate so that all workers pay more into the program
- Means testing retirees and reducing benefits for higher-income seniors
Of course, given that the clock is ticking down on Social Security's insolvency date, it's important that lawmakers arrive at a solution soon. But if they do decide to make changes to full retirement age, any increase that ensues is more likely to be applicable to younger workers, as opposed to near-retirees.
Claim your benefits strategically
If you're gearing up to claim Social Security, it's important to know your full retirement age and to understand the consequences of filing for benefits before reaching it. And if you're turning 66 in 2026, know that unfortunately, you're not quite eligible to collect your monthly Social Security benefits without a reduction.
Of course, filing for Social Security one year ahead of full retirement age won't deal your benefits as large a blow as filing three, four, or five years early. But it's important to be aware of when you're eligible to claim your benefits in full if that's something you're eager to do -- or you feel you have to do based on your financial needs.
