What Is the Normal Retirement Age?

Americans often expect to retire in their 60s. However, retirement age can mean different things, particularly regarding benefits payouts. Even if you have retired from working, your retirement age isn't typically defined as the day you did so, but rather the age you become entitled to receive benefits. If you don't meet the definition of a program's retirement age, you may be denied those benefits, even if you are actually retired.

Social Security

For the purposes of receiving Social Security benefits, the U.S. government defines "early" and "normal" retirement ages. Early retirement is age 62, as defined by the Social Security Administration. Normal, or full, retirement age varies, depending on your date of birth. For those born in 1960 or later, full retirement age is 70. If you were to retire early, your Social Security benefit would be cut by 30 percent, and your spouse's benefit would fall by 35 percent.


If you have an individual retirement account, there are two important retirement ages to remember. The first is 59 1/2. If you take money out of an IRA before this age, the Internal Revenue Service classifies your withdrawal as early, or premature. Early IRA distributions are hit with a 10 percent penalty, on top of any taxes. The second important age is 70 1/2. Once you reach that age -- technically, by April 1 of the year after you turn 70 1/2 -- the IRS requires you to begin taking money out of your IRA. Failure to do so results in a 50 percent penalty. Both of these age limits are in effect regardless of whether you are still working.

Company Retirement Plans

There is no normal retirement age when it comes to company-sponsored retirement plans. Generally, you can withdraw money from a corporate retirement plan whenever you retire, regardless of your age. However, you'll still owe taxes on your distributions, and you'll also owe the 10 percent early withdrawal penalty if you're under 59 1/2. Exceptions exist, including withdrawals made because of disability, certain medical expenses, IRS levies and separation from service after reaching 55. You can avoid taxes and penalties by rolling over any distribution to another retirement plan such as an IRA.

Expected Retirement Age

According to polling company Gallup, the average American expected to retire at age 60 in the mid-1990s. This expected retirement age has been steadily creeping upward, reaching 63 in 2002 and 67 in 2012. According to the poll, only 26 percent of non-retirees expected to retire before the once-standard retirement age of 65, as of 2012. The rise in the expected normal retirement age could be attributed to a number of factors, including a rise in life expectancy and increased economic uncertainty.

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About the Author

John Csiszar earned a Certified Financial Planner designation and served for 18 years as an investment counselor before becoming a writing and editing contractor for various private clients. In addition to writing thousands of articles for various online publications, he has published five educational books for young adults.

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