The onset of the baby boom generation reaching the milestone of “peak 65” retirement age in 2024 signals a significant demographic shift, with over 11,200 individuals projected to reach this age daily in the coming years.
However, those within this cohort may be surprised to discover that 65 is not their Social Security full retirement age, the point at which they are eligible to receive 100% of their earned benefits. Amendments made in 1983 have incrementally raised the full Social Security retirement age from 65 to 67 over a span of 40 years.
Claiming Social Security at the Best Age 65
For the majority of individuals currently retiring, their full retirement age falls somewhere between 66 and 67, explained Joe Elsasser, a certified financial planner and president of Covisum, a Social Security claiming software company.
It’s noteworthy that individuals opting to delay claiming Social Security retirement benefits until age 70 can maximize their benefit payments, irrespective of their full retirement age.
Determining your Social Security full retirement age involves considering your birth year: If you were born between 1943 and 1954, your full retirement age is 66, and for those born in 1960 or later, the full retirement age is 67.
The Social Security retirement payments are calculated based on your highest 35 years of earnings, adjusted for inflation. Your Average Indexed Monthly Earnings (AIME) is then determined, and the Primary Insurance Amount (PIA) is computed using a progressive formula. PIA represents the amount you receive at full retirement age. Claiming earlier results in a reduction, while delaying can lead to increased benefits. Factors such as work history and claiming age influence the final payment amount.
The full Social Security retirement age gradually increases from 66 to 67 for individuals born between these years:
- 1943-1954: 66
- 1955: 66 and two months
- 1956: 66 and four months
- 1957: 66 and six months
- 1958: 66 and eight months
- 1959: 66 and 10 months
- 1960 and later: 67
What Is the Maximum Social Security Retirement Benefit in 2024?
The maximum Social Security benefit you can receive is influenced by the age at which you choose to retire. For instance, if you opt for full retirement at the age of 66 in 2024, your maximum benefit would amount to $3,822. However, if you decide to retire at the age of 62 in 2024, your maximum benefit would be $2,710. Conversely, retiring at the age of 70 in 2024 would yield a maximum benefit of $4,873.
When you are prepared to initiate the process of applying for retirement benefits, utilize our online retirement application. It stands as the swiftest, most straightforward, and convenient method to submit your application.
Always remember to check with your nearest SSA office about the best option, or talk to an expert advisor on issues related to Social Security and retirement, to get the best benefit from your monthly payments and to obtain bigger monthly checks. Every extra dollar, in your golden years, counts, and a lot.
The Best Abroad Places to Live on Social Security With $1,000
Embarking on a retirement adventure abroad with a budget of $1,000 per month doesn’t mean compromising on your quality of life. Numerous countries, such as Panama, Portugal, and Mexico, beckon with exceptional healthcare, robust infrastructure, and enticing amenities, all at a fraction of the cost you’d find in the U.S.
Before taking the plunge, it’s crucial to factor in various expenses like travel costs, taxes, and visas, which can vary significantly from one country to another. Stretching your budget during your international retirement is not about making sacrifices; rather, it’s about embracing the local culture, cuisine, and lifestyle.
Contrary to the misconception that moving to a more affordable country entails compromising on quality of life, many global destinations cater to expat retirees seeking an enjoyable lifestyle and the thrill of exploring new places and cultures. The level of medical care, infrastructure, and other essential lifestyle factors can often match or even surpass their U.S. counterparts.
To determine your financial scope, consider expenses like flights back to the U.S. for family visits, as well as taxes and visas, which can vary widely across different countries. We’ve consulted with travel and budget experts who’ve traversed over 50 countries, tracking living costs worldwide.
Mexico, with its warm climate, stunning beaches, and vibrant culture, stands out as a retiree’s haven. Puerto Vallarta, Merida, San Miguel de Allende, and Ajijic offer a lower cost of living without compromising on modern amenities and a welcoming expat community. Embracing local culture, trying street food, and exploring markets can make your retirement budget go a long way.
Panama, just a short flight from the U.S., boasts lower living expenditures, especially for housing. With a favorable tax environment, warm culture, and proximity to the Caribbean and South American destinations, Panama is an enticing option.
Portugal, known for its warm climate, friendly locals, and entertainment options, offers a slower pace of life and a lower cost of living compared to many European countries. The Algarve, with its magnificent beaches, sunny weather, and affordable homes, is a popular retirement spot. Explore local cuisine, visit wine country, and discover historical sites while enjoying your time in Portugal.