Retirement is an important period in our lives, but when is the best time to retire? In the United States, retirement is linked to receiving benefits from Social Security, which may vary depending on the age you apply for the benefit for retirement. There are many aspects taken into account when it comes to these benefits, everybody won’t receive the same amount of money because of factors like your health, income, personal plans and family situation.
Here, we will help you to better understand how the U.S. retirement system works and what you should consider before making the decision of retiring.
Retirement in the U.S.
Retiring is a big deal concerning your work life and you should be informed about how Social Security benefits work once you decide when to retire. There’s not an exact answer for when it’s the perfect time to retire because it varies for every person.
Of course, many people want to retire as soon as possible because of health issues, stress, or the feeling of not being capable of keeping with the rhythm of their jobs. On the other hand, others might take advantage of working for more years to have access to a greater pension. So, this is why you should keep reading, to find out more about the Social Security system and the different consequences of retiring in different ages.
When you could retire
Are you thinking about retiring or do you want to plan your retirement? Well, let me tell you some things you should know before making this decision.
In the United States, you can start receiving benefits for retirement from Social Security from the age of 62, but the Full Retirement Age (FRA) is at 67. So, retiring before the FRA will make you receive less money every month since you start receiving the benefits for retirement. On the contrary, if you wait until 67 years old for retirement, you could receive full benefits. What about exceeding the FRA? You could also do that, this way you could receive higher benefits amounts.
Let’s talk about numbers
If we take year 2025 as the context, these are the amount of money you would approximately receive from Social Security benefits for retirement:
- At 62 years old you could obtain up to $2,831 per month.
- At 67, the amount would be up to $4,018 per month.
- At 70 you could receive up to $5,108 per month.
You might think it is all you need to know about the retirement decision, but not really…
What else?
Having in mind the previous numbers, you might think the best choice is to wait until the age of 70 and get more money, but not everybody can do this for personal reasons and, in this case, retirement at the age of 62 is not a bad idea. Before making a quick decision based on the money you would receive depending on the age you retire, let’s take into account these aspects:
- Your work life and contributions, which influence the amount of money received.
- Your current and future expenses.
- If you have other income or savings.
- Whether you live alone or not.
- Your mental and physical health.
- Your personal plans.
Do this to estimate your perfect retirement age
On the Social Security website, there is a section called ‘My Social Security’ where you can see your work life and estimate when you could receive the Social Security benefits for retirement.
This is a great option to have a clear idea of what you can do. It’s important you are informed on every benefit we want to receive, you need all the information to make important decisions that will influence the rest of your life.