Get the latest updates regarding the US Full Retirement Age – FRA Will Increase in 2024: Here’s What You Should Know. The US government has set the full retirement age, and on that basis, retirement benefits are received. Recently, the US government has increased the Full Retirement Age (FRA), which is briefly described in this article.
US Full Retirement Age
At the Full Retirement Age, the claimants can receive their full retirement benefits. The benefits that an individual earns throughout the career. The claimed benefits are affected by the claiming age. Early claiming of the benefits can impose a penalty or lifetime reduction in the benefits.
The FRA will be determined by the year an individual was born. The FRA would be 66 if the birth year is 1955. It rises to 67 for those individuals who were born in the 1960s. The claimants should claim benefits at the FRA. Notably, it is crucial to understand the changes in the Full Retirement Age (FRA).
FRA Will Increase in 2024
The Full Retirement is the age at which the benefits of working years can be claimed. After retirement, people can claim the required benefits. However, to sustain the social security funds and assets, the authorized officials decided to increase the FRA, and the determination of the FRA will be made on the basis of the birth year.
The policymakers decided to increase the Full Retirement Age to bridge the gap generated due to the depletion of Social Security Funds. As of now, the FRA is 67, which is proposed to increase to 70. The increment in the FRA will affect the individuals as they can’t claim benefits prior to 70, or their benefits will be reduced.
Impacts of FRA on Social Security Benefits
The Social Security Benefit programs will be affected by the FRA. If the FRA is 67, and the benefit is claimed at 62, then the individual will receive 70% of the benefits. Additionally, if the claim is made after FRA, it would be increased by 8%. Moreover, if the claim is made on FRA, then there will be no reduction or increment in the potential benefits.
The Social Security income generates revenue as it is taxable. It was predicted that by the end of 2030 or 2037, the reserved fund might run out of money. Thus, the officials proposed to raise the FRA to 70. It is anticipated that future retirees might get 75% of their current contribution.
FRA Fact Check
There is a set formula for the calculation of the Primary Insurance Amount (PIA) or the amount of monthly benefit. The FRA will determine the entitlement of PIA. Thus, the individuals should elect for the FRA to avoid the reduction of benefits.
For instance, if an individual was born in 1960 or after, at the age of 64 and 11 months, he or she can receive 86.1% of benefits, and at the age of 65 and 10 months, the individual can get 92.2% of the benefits. The more individuals delay the claim, the higher the benefit they can receive.
All We Know
Once an individual reaches out at the age of 70, he or she can elect for full benefits and, after this, the maximum benefits. The claimants might seek a financial advisor for the management of finances for retirement planning.
Readers can refer to this web page for the latest information and updates regarding FRA and must refer to the government’s official website for more details.