What the 2025 Social Security Age Change Means for Your Retirement Planning

If you’re nearing retirement, you’ve probably wondered when to start taking Social Security benefits. For years, age 65 was considered the “normal” retirement age, but a law passed in 1983 gradually raised this age to reflect the increasing life expectancy of Americans.

As of 2025, the full retirement age (FRA) is still rising depending on your birth year. Knowing when to claim benefits can significantly impact your monthly checks.

What’s Changing With Social Security in 2025?

Your full retirement age (FRA) marks the point at which you can claim your full Social Security benefits, based on your lifetime earnings.

• If you were born in 1958, your FRA is 66 years and eight months.
• If you were born in 1959, your FRA is 66 years and 10 months.
• If you were born in 1960 or later your FRA is 67 years.

How Much Will You Get at Different Ages?

If you begin receiving Social Security benefits before your FRA, your monthly benefit will be reduced by up to 30%, depending on how many years before your FRA you start claiming.

Conversely, if you delay benefits until after your FRA, your benefit will increase by 8% per year until you turn 70. This means waiting could result in a 32% higher monthly benefit by age 70 compared to claiming at FRA.

Here’s an example from the Social Security Administration of what benefits look like at age 62:

The earlier you claim, the lower your monthly payment will be. For some, waiting might be worth it.

What’s the Best Way to Maximize Your Retirement Income?

Stephanie McCullough, founder and financial planner at Sofia Financial, says we have to make our best guesses since we’re missing a variable in the calculation: The age when we will die. 

“One of the most helpful things all of us can do, which serves us well in a multitude of situations, is to try to keep our fixed expenses as low as we can. Those hard-to-change, repeated regular costs like housing, car payments, utilities, and monthly bills,” McCullough says. “I’m not saying you shouldn’t enjoy your life–quite the opposite! If you keep those fixed costs low, you have more room for discretionary fun stuff, as well as to adjust to any exogenous shocks life throws at you.”

When’s the Best Time to Claim?

One of the most critical decisions you’ll face as you approach retirement is when to claim your Social Security benefits.

“Waiting until 70 certainly has its benefits: a higher initial monthly payment, which means greater cost-of-living (inflation) adjustments (since they are a percent), and one that people may overlook is higher survivor benefits for the surviving spouse, if applicable,” McCullough says. “Even if the higher-earner in a couple may not live terribly long, their benefit amount will determine how much the widow(er) receives for the remainder of their life, which can have a big impact over the years.”

There are also times it makes sense to claim your benefits at a younger age, as it can increase the monthly cash flow of the household. 

There’s no one-size-fits-all answer, but there are key factors that can help guide your decision:

• Health and life expectancy: If you or your family have a history of shorter lifespans, claiming earlier may be more beneficial. If you expect to live longer, delaying benefits might be the way to go.
• Marital status: Married couples can often benefit from a strategy that maximizes survivor benefits, while single or divorced individuals might make different decisions based on their circumstances.
• Financial needs: If you need income to meet immediate financial obligations, claiming early might be necessary. But if you can afford to wait, it’s usually best to delay to increase your lifetime benefit.
• Other retirement income: Consider your investment portfolio and other retirement income sources.

How Will These Changes Affect You?

These changes are live, so it’s important to plan for them. Here’s what to consider:

• If you’re over 62: Check your FRA. If you’re close to it, decide whether to wait or claim benefits early.
• If you’re under 60: Start adjusting your retirement expectations. The FRA continues to rise, so you may need to plan for a later retirement or boost your savings.
• The longer you wait, the higher your payout: If you’re financially able to delay, a larger monthly payment could benefit you greatly.

Other Social Security Changes in 2025

Along with the increase in the full retirement age, other Social Security adjustments are set to take effect in 2025:

• Cost-of-living adjustment (COLA): Recipients will see a smaller increase of 2.5% in their benefits, down from 3.2% in 2024.
• Maximum taxable earnings: The maximum amount of earnings subject to Social Security taxes will increase from $168,600 to $176,100.
• Appointment-based services: To improve efficiency, Social Security offices will move to an appointment-only model for in-person services nationwide.
• The earnings test: If you’re below FRA and continue working, your benefits may be reduced based on your earnings. In 2025, the income limit before reductions will rise to $23,400 (up from $22,320 in 2024). After FRA, you can earn up to $62,160 without any adjustments, a $2,640 increase from 2024.

The Bottom Line

With Social Security rules changing, it’s important to plan ahead. Whether you’re already eligible or a few years away from retirement, understanding the new FRA and how it impacts your benefits will help you make the best financial decisions. Consulting with a financial expert and adjusting your retirement strategy now could mean a bigger payout later.

The key takeaway: Don’t rush into claiming Social Security benefits without considering how the age adjustments will impact your monthly payments. Consider your life expectancy and retirement savings to figure out the best time to start taking benefits.