Why isn't Full Retirement Age defined as 70?

[skeddy]

retired fed employee. I retired at 55. My wife will outlive me but between her pension, her SS, and getting 55% of my monthly pension when I die, she'll never have to touch our savings or investments. I'm very fortunate, threads like this are a great reminder of that.

[matisse12]

I always think that younger people have no idea whatsoever how it feels to be 70 for many people.

And have no idea how it feels to be 65 for many people.

In relation to working.

[ihatetodust]

The only person I know personally who was healthy enough to work until 70 and who faced no layoff, family issues, etc. retired in July a few years ago. He died December of that same year, of a flu that got out of control and went to double pneumonia. Doesn't seem like a good way to go. Being healthy TODAY is all you have.

[bpollen]

Originally Posted by josie13

We know that people age 62 and up can claim Social Security benefits at any time. The benefits keep rising after we reach our nominal Full Retirement Age of 65 or 66 or 67. It's sort of messy to have FRA defined as different ages for different birth years, especially since the benefits continue to grow for everybody who delays claiming until age 70.

Wouldn't it be simpler to just define FRA as 70, since the potential benefits stop rising after that age for everyone?

The FRA is based on life expectancy stats, I think. A beneficiary receives the same money whether he starts collecting at 62 or 71, if he lives to the standard life expectancy. That's why it's less if you start collecting at 62. It's the same lump sum, divided by more months. If you die younger than the statistical LE, then you made more $ if you started collecting at a younger age. If you live longer than the statistical LE, then you make more $ if you start collecting at FRA. Because you are getting more than the full lump sum that was used to calculate your benefits.

So they didn't just pick an age out of thin air. It's based on something.

That's my understanding.

BTW, if you choose to get SS later but then have to use your own savings to live on, then you're probably better off getting SS earlier. It's better to get SS, if you need $$ to live on, than to spend your retirement account (the idea being to let your retirement savings grow for as long as possible - remember, your SS isn't really growing 8% like they say; you'll still get the same lump sum, unless you live longer). Taking your SS at FRA is a choice for people who are still getting earned income. Not so much for those who are retired from working a job.