What’s the average retirement age in the U.S.?

The average retirement age in the United States varies depending on the data source.

Gallup surveys suggest it’s around 61 years, while the Center for Retirement Research at Boston College reports 64.7 for men and 62.1 for women.

Despite the differences, one thing is clear: Americans are retiring later than they did in the 1990s, when the typical age was 57.

Factors influencing retirement age

A variety of factors impact when people decide to retire, and these go beyond mere numbers. Let’s explore some of the key drivers behind the decision.

Economic factors

The shift in Social Security’s full retirement age from 65 to 67 has influenced many to delay retirement to maximize benefits. Workers relying on 401(k) plans may retire later, as they need time to grow their savings.

Sadly, nearly half of Americans lack retirement savings altogether, making it harder to retire comfortably.

Lifestyle choices

Your vision for retirement is another major factor. Planning to travel or pursue hobbies? You might delay retirement to ensure you have sufficient funds.

On the other hand, a simpler lifestyle with fewer expenses could allow for earlier retirement.

Health considerations

Health is often a decisive factor. Good health may encourage continued work to boost financial security, while chronic conditions could push someone to retire earlier than planned.

Location and cost of living

Where you live significantly impacts your retirement planning. High-cost areas demand more savings, often delaying retirement.

Conversely, downsizing or moving to a lower-cost location might accelerate your plans.

Personal preferences

What are your goals for retirement? Whether it’s spending more time with family, pursuing a dream, or continuing work you enjoy, personal preferences heavily influence the average retirement age for each individual.

Regional variations in retirement age

Retirement age patterns vary across the United States. Southern states tend to have lower averages, with Alaska and West Virginia leading at 61 years. At the opposite end, Washington, D.C., has the highest at 67 years, followed closely by Hawaii, Massachusetts, and South Dakota at 66 years.

These regional differences often reflect the local cost of living, cultural norms, and job opportunities.

States with higher living costs may require longer work periods to ensure financial security during retirement.

Retirement age by profession

Physically demanding jobs, such as construction or firefighting, often lead to earlier retirements, as the physical toll becomes too challenging with age. By contrast, less physically taxing professions, such as management or academia, allow individuals to work well past 65.

For example, there are about 5 million workers aged 65 or older in management and professional fields.

Meanwhile, service-oriented roles, such as food servers, account for only 1.6 million, and trades like carpentry see even fewer workers in this age group.

Social Security and retirement

For individuals born in 1960 or later, full benefits begin at 67 years old. Those born between 1943 and 1959 can claim full benefits between ages 66 and 66 years, 10 months.

You can start receiving Social Security as early as 62, but benefits will be permanently reduced. For instance, retiring at 62 instead of 67 may lower your monthly benefits by up to 30%.

Delaying retirement beyond full retirement age, however, results in increased benefits through delayed retirement credits. These credits can boost your payments by 8% annually until age 70.

For example, if your full benefit is $1,000 per month at 67, retiring at 62 reduces it to $700 per month, while waiting until 70 increases it to $1,240 per month.

Preparing for your ideal retirement age

Retirement planning isn’t one-size-fits-all. While statistics show the average retirement age as a guideline, your personal goals, health, and financial situation will ultimately shape your timeline.

Tips for Retirement Planning:

• Assess your savings: Regularly review your retirement accounts, such as a 401(k) or IRA.
• Plan for health expenses: Healthcare costs can be significant during retirement, so budget accordingly.
• Evaluate Social Security: Decide the best time to start receiving benefits based on your financial needs.

The average retirement age provides insight into broader trends, but it’s important to remember that everyone’s journey is unique.

Whether you aim to retire early or work into your golden years, understanding the factors at play can help you make informed decisions.

Retirement isn’t just about leaving the workforce; it’s about entering a new chapter of life on your terms.

Whatever age you choose, make sure it aligns with your goals and financial security.