In order to make such an important decision, you need to look at the financial impact an early retirement can have on your Social Security benefits. Once you have the numbers, you can see if delaying retirement by a few more years is worth being able to retire early.
What is full retirement age?The full retirement age or "normal retirement age" used to be set at age 65. Today, that age has since increased to age 67 for people born after 1959. To determine your FRA, use the Social Security Administrations (SSA) retirement age calculator.
The longer you wait, the bigger the benefitYour Social Security retirement benefits will be increased by a certain percentage (depending on date of birth) if you delay your retirement until you reach your full retirement age. At full retirement age your benefit is 100% of your Primary Insurance Amount. When you reach age 70, the increase will cease — even if you continue to delay taking your benefits.
The Social Security Administration provides a chart that outlines the effect of early or delayed retirement on retirement benefits. (Note: If you were born on January 1st, you should refer to the rate of increase for the previous year.)
Knowing when to say when
If you're still trying to decide if taking an early retirement is a financially feasible option for you, you may be getting a lot of advice on collecting benefits as early as age 62, or waiting until after you have reached your FRA. Because your situation is different from anyone else's, it's best to do your homework first, and then discuss with a financial professional the best options for you.
For more information on how to retire early, and articles discussing how to start saving for retirement, visit the Protective Life Learning Center.