Social Security: Fact Sheet on Changes in the Retirement Age

CRS Report for Congress
Social Security: Fact Sheet on Changes in the
Retirement Age
Geoffrey Kollmann
Specialist in Social Legislation
Domestic Social Policy Division
The Social Security “full retirement age” — the age at which retired workers, aged
spouses, or surviving aged spouses receive benefits that are not reduced for “early”
retirement — will gradually rise from 65 to 67 beginning with people who attain age 62
in 2000 (i.e., those born in 1938). Early retirement benefits will still be available
beginning at age 62 (age 60 for aged widows and widowers), but at lower levels.
The original Social Security Act of 1935 set the minimum age at which workers could
receive Social Security retirement benefits at 65. In 1956, (for women) and 1961 (for men)
Congress lowered the minimum age to 62, but also provided that benefits taken before age
65 would be permanently reduced to account for the longer period over which benefits
would be paid. This “actuarial reduction” is 5/9 of 1% for each month benefits are
received before age 65 — a 20% reduction at age 62. In 1972, Congress set aged
widow(er)’s benefits at 100% of the deceased worker’s benefit if elected at age 65 or later.
Reduced widow(er)’s benefits could be elected as early as age 60 (the reduction is 19/40
of 1% per month — a 28.5% reduction at age 60).
Beginning in the mid-1970s, raising the retirement age was studied by several
advisory panels. The initial impetus for these studies was concern over projections of
growing long-range deficits in the program. A major part of the problem reflected a
declining ratio of workers to retirees. Forecasts showed that, whereas a little more than
three workers were supporting each recipient then, only two would do so in the next
century. It was argued that increasing the retirement age would offset this decline, thus
bolstering the financing of the program. It also was argued that it would properly
recognize the substantial increases in longevity that had occurred and were projected to
When Congress enacted legislation in 1983 (P.L. 98-21) to solve Social Security’s
financing problems, it included a provision that gradually will raise the full retirement age
(the age at which one receives unreduced benefits) from 65 to 67. It does so in two steps.
First, the full retirement age (FRA) will increase by 2 months for each year that a person

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is born after 1937 (i.e., attains age 62 after 1999), until it reaches age 66 for those who
were born in 1943 through 1954 (who attain age 62 in 2005 through 2016). Second, it
will increase again by 2 months for each year that a person is born after 1954 (i.e., attains
age 62 after 2016), until it reaches age 67 for those who were born after 1959 (who attain
age 62 after 2021). Early retirement still will be available, but benefits will be lower, e.g.,
the actuarial reduction in retirement benefits ultimately will be 30%, instead of the present
20%, at age 62. The age for full benefits for aged spouses and widow(er)s likewise will
rise to 67.
1983 Changes in the Social Security Retirement Age for Workers
Full retirement age
Year of birthYear age 62(year/month)Reduction at age 62
before 1938before 20006520.0%
1938 2000 65/2 20.8
1939 2001 65/4 21.7
1940 2002 65/6 22.5
1941 2003 65/8 23.3
1942 2004 65/10 24.2
1943-1954 2005-2016 66 25.0
1955 2017 66/2 25.8
1956 2018 66/4 26.7
1957 2019 66/6 27.5
1958 2020 66/8 28.3
1959 2021 66/10 29.2
1960 & later2022 & later6730.0
In 1983, it was projected that the new provision would reduce Social Security’s long-
range costs by slightly more than 5%. This, combined with other measures contained in
P.L. 98-21, was projected to balance Social Security’s income and outgo over the next 75
years. Since 1983, Social Security’s financial picture has worsened, leading to renewed
interest in raising the retirement age further. For information on proposals that would
make changes in the retirement age, and arguments for and against doing so, see CRS
Report 94-622, Social Security: Raising the Retirement Age, Background and Issues,
updated regularly.