The retirement age has been increasing since 1935 when it was set by Congress at 65. It is currently 67 years old and is likely to continue rising as the Baby Boomer generation begins to retire. What does this mean for individuals planning to retire and collect Social Security benefits soon? Here’s what you need to know about the rising age for retirement.
The age set by Congress does not dictate when you stop working, only the age when you can collect your Social Security benefits, and how much you can collect. You can start collecting a reduced amount of your benefits when you turn 62, and only get your full benefits when you turn 67. Knowing this, you can prepare for your retirement much better.
As people live longer, the normal retirement age is likely to rise. This is the only way to help keep Social Security financially solvent. As it is, the program was not designed to support people as long as it must currently do so. However, increasing the normal retirement age has some serious consequences.
Let’s say that office workers can stave off their retirement to 67. How about the blue-collar workers? The labor market may not be able to support them, as Social Security has been projected to be depleted by 2034 to 2038. Hopefully, there would already be some attempts to restructure the program before that.
When this happens, the burden of planning falls on you and your retirement savings. If you are planning, or have no choice other than to retire early. Your savings may be the only source of income you have until your Social Security kicks in.
Do you know what they always say about the only 2 sure things in life?
- Retirement Social Security can be taxed.
- Making smart decisions before the time comes, not only means saving up for your retirement, but also planning your tax liabilities so you can have more to keep as your own.
Let Peter Witts CPA PC take this burden off of your shoulders. We have professional tax planners who can help you with planning your taxes and long-term financial plans. Give us a quick call, let’s make sure that as early as possible, to protect your income for retirement and give you security through your retirement.