Retiring at your full retirement age is a wise decision that offers numerous benefits, including financial security, peace of mind, and increased longevity. If you reach full retirement age (FRA) based on your birth year, you can receive 100% of your Social Security retirement benefits.
The benefits of waiting to reach your FRA go beyond money. Not taking an early retirement can increase your mental wellness and longevity.
Here is the statistical data that supports retiring at your FRA as the best option.
1. Financial Security
Retiring at your FRA offers financial security, as you will receive the full Social Security retirement benefits you are entitled to. For most retirees, Social Security benefits are a significant source of income, and retiring early may result in a 30% decrease in benefits.
According to the Social Security Administration, people who were born between 1943 and 1954 reach their FRA at the age of 66. If you retire at 62, your Social Security benefits will be reduced by 25%. However, if you wait until your FRA, you will receive 100% of your benefits.
Retiring at your FRA can also help you maximize your retirement savings. If you retire early, you will need to rely more on your retirement savings, which may not be enough to sustain you for the duration of your retirement. However, if you retire at your FRA, you will have more time to save and accumulate wealth.
2. Peace of Mind
Retiring at your FRA can also offer peace of mind. You know that you will receive the full amount of your Social Security retirement benefits, which can help you cover your living expenses and other financial obligations during your retirement years.
Additionally, retiring at your FRA can help you avoid the stress and uncertainty of working beyond your retirement age. Many retirees who continue to work past their FRA do so because they need the income or are worried about running out of money during their retirement years. Retiring at your FRA can eliminate these concerns and allow you to enjoy your retirement without worrying about financial issues.
3. Increased Longevity
Retiring at your FRA can also lead to increased longevity. A study in the Journal of Health Economics found that retiring at 62 can shorten life expectancy by up to three years. This is because retirement provides opportunities for increased physical activity, improved mental health, and reduced stress, all of which can contribute to better health outcomes and longer life.
Furthermore, the financial security that comes with retiring at your FRA can also help improve your overall health and well-being. Financial stress is a major contributor to poor health outcomes, and retiring early can increase the likelihood of financial stress.
Statistical Data
Statistical data support the benefits of retiring at your FRA. According to the Social Security Administration, approximately 63% of retired workers receive at least half of their income from Social Security retirement benefits. Nearly one-third rely on Social Security for 90% or more of their income.
Furthermore, a survey conducted by the Employee Benefit Research Institute found that retirees who retired at their FRA had the highest satisfaction levels compared to those who retired earlier or later.
The survey also found that retirees who retired at their FRA had the highest confidence levels in their ability to cover their basic living expenses during retirement compared to those who retired earlier or later.
Conclusion
Retiring at your full retirement age is the best decision for financial security, peace of mind, and increased longevity. Retiring early can reduce your Social Security retirement benefits and increase your financial stress, while working beyond retirement can lead to stress and uncertainty.
Statistical data support the benefits of retiring at your FRA, with most retirees relying on Social Security retirement benefits for at least half of their income and those who retire at their FRA having the Highest levels of satisfaction and confidence in their retirement.
In addition, retiring at your FRA can also provide opportunities for increased physical activity, improved mental health, and reduced stress, which can contribute to better health outcomes and longer life.
It’s important to note that everyone’s financial and personal circumstances are different, and the decision to retire at your FRA may not be the best option for everyone. Personal health, financial stability, and retirement savings should be considered when making this decision.
However, for those who can retire at their FRA, it can be a wise decision that provides financial security, peace of mind, and a better quality of life during retirement.