When discussing Social Security benefits, it’s important to understand what the Full Retirement Age (FRA) is. This is the point at which a beneficiary can access full Social Security retirement benefits without any age reductions.
Applying for these benefits early, starting as soon as age 62, results in a permanent reduction in the monthly amount. Conversely, postponing the application beyond the FRA, up to age 70, allows for the accumulation of late payment credits that permanently increase the benefit.
Retirement in the US: Why the FRA Changes Periodically
The origins of this regulatory framework date back to the program’s inception. Initially, the full retirement age was set at 65 for the vast majority of covered workers.
A few decades later, the US Congress enacted amendments in 1983 to ensure the system’s sustainability in the face of demographic changes. These amendments mandated a phased increase in the FRA in response to the rising life expectancy and population aging.
The implementation of this increase was designed to be carried out gradually over several years, determining the final FRA according to the individual’s year of birth:
- For people born in 1937 or earlier, the age remained at 65 years.
- Those born between 1943 and 1954 have a FRA of 66 years.
- For the cohorts from 1955 to 1959, age increased in intervals of two months per year, settling at 66 years and 10 months for those born in 1959.
- The provision states that all individuals born in 1960 or later have a FRA of 67 years.
The highest FRA in History Debuts in 2026
The year 2026 marks the culmination of this gradual adjustment process that began more than four decades ago. In that year, the FRA age of 67 will be applied uniformly to all beneficiaries born in 1960 or later. This means that people who turn 62 in 2026, belonging to the 1964 birth cohort, will have to wait until age 67 to receive their full pension without any reductions.
For those born in 1960, who will reach 66 years of age during 2026, their retirement age of 67 will be effectively completed in 2027. This is not a new legislative reform recently approved, but rather the completion of the implementation of the 1983 law.
Groups with lower retirement ages, such as 66 years or 66 years and several months, have already gone through this process in previous years.
The Costs of Requesting Your Retirement Too Early
The timing of when to apply for benefits has direct and lasting financial consequences. For someone with a Family Allowance for Retirement (FRA) of age 67, applying at the minimum age of 62 results in a permanent reduction that can be as much as 30% of the full benefit amount.
Each year of waiting beyond the FRA, up to age 70, generates an annual delay increase of eight percent, which can mean a maximum increase of 24% for those who wait until age 70.
The income test rules also affect those who choose to work while receiving benefits before reaching FRA. As of 2026, $1 will be withheld from benefits for every $2 earned above the annual limit of $24,480. In the year the beneficiary reaches FRA, the income limit rises to $65,160, and withholding is applied at a rate of $1 for every $3 earned above that limit.
The COLA Increase: What It Does for Your Retirement
Along with the standardization of the FRA at age 67, 2026 includes other automatic adjustments to the program. A cost-of-living adjustment (COLA) of 2.8% is projected for benefits. In addition, the maximum income subject to Social Security tax will increase to $184,500. Official estimates place the average monthly benefit at approximately $2,071 for retirees during that period.
Although the FRA is set to stabilize at 67 years starting in 2026, there are legislative proposals that could modify this parameter in the future. The projected deficit in the Social Security trust fund, whose reserves could be depleted by 2033 according to recent reports, has generated discussions in Congress about possible reforms. Among the measures being debated is a further increase in the full retirement age, for example, to 68 or 69 years.
These discussions are part of a broader range of options that include modifications to the payroll tax structure, adjustments to the formulas for calculating benefits, and changes to the COLA methodology.
