You will often hear and see this acronym concerning the discussion of Social Security benefits. Social Security's full-benefit retirement age (FRA) was originally set at 65. The Social Security Act was signed into law by President Roosevelt on August 14, 1935. In addition to several provisions for general welfare, the new Act created a social insurance program designed to pay retired workers age 65 or older a continuing income after retirement. The FRA remained constant from the beginning of Social Security until legislation that was passed in 1983 recognized Americans were living much longer than when Social Security was implemented. That legislation created an increasing scale for FRA beginning with those born in 1938. Those born in 1939 were given an FRA of 65 years and 2 months. The FRA gradually increases to where those born in 1960 and later have an FRA of 67. Go to the Social Security website to find your FRA. The increase in the FRA, one of many provisions in the 1983
amendments designed to improve the system’s financial outlook, was based on the rationale that it would reflect increases in longevity and improvements in the health status of workers. The 1983 amendments did not change the early eligibility age of 62; however, the increase in the FRA results in larger benefit reductions for workers who claim benefits between the age of 62 and their FRA.
The FRA is the age which you will earn 100% of your full retirement benefit, based on your earnings history. How this is calculated is discussed in a separate blog entitled “Calculating your Benefit”.
There is a financial bonus for delayed retirement. An individual reaching the full-benefit age in 2017 (66 years and 2 months old) receives a monthly benefit that is 8 percent higher for each year he or she delays collecting benefits until the latest claiming age of 70, at which point benefits are 132% of what they would have been at the normal retirement age (when the full benefit age reaches 67, benefits claimed at age 70 will be 24 percent higher because of that delay.) The maximum retirement benefit in 2017 for someone who waits until age 70 to collect benefits is $3,538 a month.