Older Americans have good news and bad news: the Social Security full retirement age is going up again in 2022 for some people.
For people born in 1960 (and turning 62 this year), the full retirement age increased to 67 this year. The full retirement age will remain 67 for anyone born after 1960 as long as Congress doesn’t change it in the future.
As part of a law that strengthened the program’s finances in 1983, Congress mandated the change to the full retirement age. They cited the increased life expectancy and improved health of older Americans as reasons for doing so.
Workers who start collecting Social Security benefits at 62 can collect them until they reach full retirement age, but there’s a penalty if they do so. A benefit is lessened 5/9 of one percent every month before the full retirement age, up to 3 years. If the number exceeds 3 years (or 36 months), the benefit is further reduced by 5/12 of one percent every month. For example, if someone chooses to collect Social Security at 62, their benefits will be reduced by 30% each month.
Here is the full retire age for individuals based on the year they were born:
1955: 66 and 2 months
1956: 66 and 4 months
1957: 66 and 6 months
1958: 66 and 8 months
1959: 66 and 10 months
Social security recipients in 2022 received the largest payment increase in almost 40 years, reflecting thee highest inflation since 1982.
Last year, the Social Security Administration declared that the cost-of living adjustment would be 5.9%.
For an average retired person, that would be a monthly rise of $92, bringing the total to $1,657. For a typical couple, their monthly benefits would boost by $154 to $2754.
About 70 million Americans will be affected by the tax cut. More than half of seniors live in homes where Social Security benefits give them with at least half of their total income, while roughly 25 percent depended on the monthly benefit for nearly all of their earnings.
The increase signifies an end to low inflation that has seen years of meager COLA raises. Over the previous 12 year period, the average COLA has increased by just 1.4 percent. In 2021, recipients earned a rise of just 1.3%, or roughly an additional $20 a month for retirees.