Reaching the age of 67 is a significant milestone for many individuals, particularly for those looking forward to claiming Social Security benefits. At this age, many people are eligible to begin receiving their full Social Security retirement benefits, assuming they’ve worked enough years to qualify.
However, the amount you can expect to receive from Social Security depends on various factors, including your work history, lifetime earnings, and the age at which you begin claiming your benefits.
In this article, we’ll explore what the average Social Security benefit looks like for someone who begins collecting at age 67 and 2 months, which is the full retirement age (FRA) for those born in 1960 or later.
Understanding Full Retirement Age (FRA)
Full Retirement Age (FRA) is the age at which a person can begin receiving their Social Security retirement benefits without any reductions. For individuals born in 1960 or later, FRA is set at age 67. This means that if you were born in 1960, you will reach full retirement age at 67, and if you claim benefits at this age, you’ll receive your full, unreduced monthly payment.
It’s important to note that if you decide to claim Social Security benefits before age 67, your monthly benefit will be reduced, while delaying it beyond FRA (up until age 70) will result in higher monthly benefits due to delayed retirement credits.
The Average Social Security Benefit at Age 67
According to the Social Security Administration (SSA), the average monthly Social Security benefit for retirees at full retirement age (67) in 2024 is approximately $2,100. This amount represents the typical benefit, but the actual amount varies depending on factors such as your lifetime earnings and work history.
Can You Work and Still Receive Social Security Retirement Benefits?
To qualify for the average monthly benefit of $2,100, you must have worked and paid into the Social Security system for many years, earning a relatively high average income throughout your career. If your earnings were lower, your benefit will likely be lower as well. Conversely, individuals with higher lifetime earnings will generally receive higher Social Security payments, up to a maximum allowable amount.
How Your Earnings Affect Your Social Security Benefit
The Social Security benefit is based on your average indexed monthly earnings (AIME), which is calculated using your 35 highest-earning years. The SSA adjusts these earnings for inflation, so even if you had low wages early in your career, they will be adjusted upward. If you have fewer than 35 years of work history, the SSA will fill in the gaps with zeros, which can lower your benefit amount.
To receive the maximum Social Security benefit at full retirement age, you must have earned the maximum taxable earnings each year throughout your career. In 2024, the maximum monthly benefit for someone retiring at 67 is $3,636. This is for individuals who have worked for 35 years at the maximum taxable earnings level, which is $160,200 in 2024.
Impact of Delayed Retirement on Social Security Benefits
If you choose to delay your benefits beyond your full retirement age, your Social Security payments will increase. For every year you delay your benefits past age 67, your monthly benefit will increase by approximately 8% until you reach age 70. This can be a great strategy if you are in good health and plan to continue working or if you want to maximize your lifetime benefits.
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For example, if you wait until age 70 to begin receiving your benefits, your monthly benefit could be up to 24% higher than what you would have received at 67. While the average benefit at age 67 is around $2,100, waiting until 70 could increase that amount to about $2,600 per month.
Other Factors That Can Affect Your Social Security Benefit
While the average benefit for someone at age 67 is useful as a benchmark, several factors can influence how much you actually receive. These include:
- Work History: The more years you’ve worked and the higher your earnings, the higher your Social Security benefit will be. Social Security calculates your benefit using your 35 highest-earning years.
- Early or Late Claims: If you claim your Social Security benefits before age 67, your monthly benefit will be reduced. On the other hand, delaying your benefits will result in a higher monthly amount.
- Spousal Benefits: If you’re married, you may be eligible for spousal benefits, which can increase the total amount you receive. If your spouse has a higher benefit than you, you may be able to claim half of their benefit, as long as it’s greater than your own.
- Working While Receiving Benefits: If you plan to work while receiving Social Security benefits before reaching age 70, you may be subject to the Social Security earnings test, which could temporarily reduce your benefits if you exceed certain income limits.
Planning for Retirement: What You Can Do
When planning for your retirement, it’s important to consider how Social Security fits into your overall financial strategy. While the average benefit of $2,100 per month can provide a solid foundation for many retirees, it is unlikely to cover all living expenses. The cost of living varies by location, and other expenses, such as healthcare, may need to be accounted for as well.
Here are a few tips to ensure you are prepared for retirement:
- Save and Invest: In addition to Social Security, it’s essential to build up other retirement savings through employer-sponsored plans like 401(k)s or individual retirement accounts (IRAs).
- Work with a Financial Planner: A financial planner can help you assess your retirement goals, estimate your Social Security benefits, and create a strategy for additional savings.
- Understand Medicare: As you approach age 65, you’ll be eligible for Medicare. Understanding how Medicare works and how it will impact your healthcare costs in retirement is key to planning for the future.
Conclusion
At age 67 and 2 months, you’re eligible to begin receiving your full Social Security benefits without reductions. The average benefit for someone retiring at this age in 2024 is approximately $2,100 per month, though the amount can vary depending on your work history and lifetime earnings.
If you’ve worked for many years and earned a higher income, you may be eligible for a higher benefit, while those with fewer years or lower earnings may receive less.
As you approach retirement, it’s crucial to understand how Social Security fits into your overall financial picture and to plan accordingly by saving and investing for the future. While Social Security can provide a solid foundation, having additional savings and investments will help ensure a comfortable and secure retirement.