For years, Americans have seen the retirement age gradually rising, but the reason behind the changes has not been clearly explained to Social Security beneficiaries. However, the reason is now known and it’s becoming impossible to ignore. The government has changed the full retirement age (FRA) to 67 in 2026, and the reason is that Social Security is at risk of becoming insolvent and therefore needs money. The rise to 67 is the final step in a decades-old plan that is designed to reduce lifetime benefits and protect the finances of the program.
By raising the retirement age, workers will now have to work longer before claiming their benefits. Beginning in 2026, those born in 1960 or later won’t be eligible for their full benefits until 67. This will be the highest retirement age in U.S. history, and it is expected to affect how Americans plan for retirement.
Why the Full Retirement Age Matters So Much
The full retirement age matters because it is the key to unlocking your primary insurance amount, which is the baseline calculation for your Social Security benefits. FRA determines when you are eligible to collect 100% of your Social Security benefits without penalties or deductions.
Claiming even one month before FRA permanently reduces your monthly benefits, while claiming after FRA boosts them. Therefore, it is important that you decide when to claim your benefits depending on your retirement plan.
What Exactly Is Changing in 2026
Beginning in 2026, anyone born in 1960 or later will face the new FRA of 67. This means that anyone turning 66 in 2026 won’t qualify for full benefits and will have to wait until 2027. This is the final step of a schedule Congress enacted in a 1983 reform that was designed to stabilize Social Security’s finances. Before this law, FRA was 65. Since 2021, the FRA has been rising by two months each year. At the moment, it is at 66 years and 10 months for workers born in 1959.
By raising the retirement age, the government is able to increase the intake of more funds and reduce the much-needed long-term cost reduction. When workers have to wait until 67, Social Security is able to reduce the number of months they will collect benefits or push them to early claiming, which earns them income through reduced checks.
Delayed Retirement Credits Also Shrink
Additionally, raising the FRA to 67 means fewer years of delayed retirement credits. When the FRA is at 67, workers can only delay claiming their retirement for only 3 years because at 70, benefits stop increasing.
In the past, when the FRA was 65, retirees could earn credits for 5 years, and when it was 66, they could earn for 4 years. Those approaching retirement will now have fewer opportunities and a shorter period to build up the larger payments for their retirement.
Why Millions May Still Be Caught Off Guard
Millions of people approaching retirement may be unaware of the change even though the schedule was set decades ago. For those who are up-to-date, the change doesn’t make retirement easier and better.
“Raising the retirement age is an effective cut in lifetime benefits for younger baby boomers, members of Gen X and all the generations after,” says Max Richtman of the National Committee to Preserve Social Security and Medicare.
The change doesn’t make retirement easier because it is occurring at a time when there is wage stagnation, rising costs, and widespread financial strain. He also adds that while retirees will have more time to plan their retirement, it doesn’t mean that they will be able to put aside more money for retirement.
Preparing for the New Reality
Younger boomers and Gen Xers who are approaching retirement must factor in the change in FRA. They have to be aware that claiming early might cost them up to 30% while waiting until 70 could earn them a 24% boost.