The full retirement age for Social Security benefits is 67 for those born in 1960 or after — but that doesn’t mean every American will be able to retire comfortably by that age.
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But retiring later than that might not be a bad thing. Read on for more details about the potential benefits of retiring later.
A full 64% of workers worry about running out of money in retirement, per a 2025 survey by HireClix. And worry they should. The Fed’s latest Survey of Consumer Finances found a median retirement savings of just $185,000 for pre-retirement workers aged 55-64. At a 4% withdrawal rate, that would generate a paltry $7,400 in annual retirement income.
Catherine Collinson, CEO of retirement research organization Transamerica Institute, added some historical context: “Baby Boomers were already mid-career when 401(k)s were introduced. When Gen X entered the workforce, 401(k)s were gaining traction but relatively few workers were offered one.”
According to a 2025 survey by F&G Annuities & Life, 70% of workers over 50 either plan to delay retirement or are considering it. But is that such a terrible thing? Many financial and aging experts make the case that later retirements aren’t the nightmare that workers fear.
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The later you start taking Social Security benefits, the greater the monthly paycheck.
Every year that you delay taking benefits after 67 adds another 8%. If you wait until 70, you’ll collect 32% more than you would have at 67. That’s a huge bump for just waiting a few extra years.
The earlier you retire, the longer you need your retirement savings to last you — and the less you can pull out every year.
If you want your nest egg to last for 30 years of retirement, Charles Schwab recommends withdrawing no more than 3.8% of it each year. That comes to just $19,000 a year for a $500,000 nest egg.
But if you need your portfolio to last you only 20 years, you can withdraw 5.4% ($27,000 a year for the same nest egg). And if you just need it to last 10 years, you can withdraw 10.3% ($51,500).
The greatest risk to your retirement portfolio is a market crash in the first few years of your retirement. It’s called sequence of returns risk — that an early crash does more damage than the same crash later in your retirement.
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