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Paynesville Press - January 12, 2005

Know your retirement age

By Steven Thayer

Do you know what your "full retirement" age is for Social Security? And do you know what retiring earlier than your full retirement age might mean in actual dollars and cents?

Unfortunately, findings from the 2004 Retirement Confidence Survey show that most people do not know that the age for receiving full benefits is gradually rising from 65 to 67. This also means most folks do not know how that change could affect their retirement planning.

So here is some truly vital information that all Americans should be aware of...whether they are one year or 20 years away from retirement.

In 1983, Congress made changes designed to strengthen the long-term financial health of the Social Security system. One of those changes was to gradually increase the full retirement age, beginning in 2003. At that time, the full retirement age for workers born in 1938 became 65 years and two months.

The age for receiving full Social Security retirement benefits will continue to rise until, in 2027, when it reaches 67 for those born in 1960 or later.

Workers can still retire as early as age 62 and collect a reduced benefit. If you were born in 1940 and are planning to retire in 2005, your full retirement age will be 65 years and six months.

But what does the change actually mean in terms of benefit payments? There is a formula that you could use to figure out the difference between retiring at age 64 or age 65 or age 65 and six months - but it can be time-consuming and requires several computations.

Luckily, Social Security has a convenient chart that you can use to get the same information at a quick glance. For example, if you were born in 1940, the full retirement age is 65 years and 6 months and the reductions of benefits for retiring any earlier are: at age 62, 77.5 percent; at age 62 and 6 months, 80.0 percent; at age 63, 83.3 percent; at age 63 and 6 months, 86.7 percent; at age 64, 90.0 percent; at age 64 and 6 months, 93.3 percent; at age 65, 96.7 percent; at age 65 and 1 month, 97.2 percent; at age 65 and 2 months, 97.8 percent; at age 65 and 3 months, 98.3 percent; at age 65 and 4 months, 98.9 percent; at age 65 and 5 months, 99.4 percent; and at age 65 and 6 months, 100 percent.

What if you are younger and were born in the mid to late 1940s or the 1950s? Social Security also has convenient, easy-to-use tables for people who reach full retirement age in succeeding years. For example, there is a separate table for workers who were born in 1956 and whose full retirement age would be 66 years and 4 months.

The online tables are even more useful because they also show reductions in spousal retirement benefits that would be in effect between age 62 and the full retirement age.

These are helpful reference tables for folks who are beginning to plan their retirement years. These tables can help you find your full retirement age and evaluate the financial pros and cons for you and your family of retiring early or waiting until you reach full retirement age. Just go to

(Editor's Note: Thayer is the district manager for Social Security in St. Cloud.)

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