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Dream Again

What will your retirement age be?

Have you ever wondered why age 65 is considered by some to be the "normal retirement age"?

Age 65 has long been considered a typical retirement age, in part because of rules around Social Security benefits. In 1940, when the Social Security program began, workers could receive unreduced retirement benefits beginning at age 65. In 1983, the rules changed to increase the Social Security full retirement age gradually from age 65 to age 67, beginning in 2000. Currently, the Social Security full retirement age is 66 for those born between 1943 and 1959 and 67 for anyone born 1960 or later.

The Social Security age requirement is not the only thing that's changed. In 1940, anyone retiring at age 65 would spend, on average, around a dozen years in retirement. Today because of improvements in health care, that number has increased to 18 years for men and 20 years for women.[1] It's more important than ever to factor this trend into your retirement plans.

Whatever your age when you decide to retire, outliving your money should ideally be the least of your concerns. There are ways to help avoid this happening. Consider these 3 options:

  1. Save more now. If you need to keep working because you won't have enough saved, take steps now to increase your savings. Contribute the maximum to your employer's retirement plan and to any individual retirement accounts (IRAs).
  2. Wait a little longer to collect Social Security benefits. For every year you wait past your full retirement age to elect benefits, you earn delayed retirement credits. The credits can increase your monthly benefit by about 8 percent per year, up to age 70.
  3. Limit your retirement spending. Many financial professionals recommend that you tap no more than 4 to 5 percent (adjusted annually for inflation) of your nest egg each year to help make your money last.

Your Age and Retirement

As you get closer to retirement, here are some key ages to keep in mind:

  • Age 55 – May withdraw retirement plan savings without penalty if you leave your job or retire
  • Age 59 ½  – May withdraw money from qualified plans/IRAs without IRS penalty[2]
  • Age 62 – Earliest age to begin collecting Social Security
  • Age 65 – Entitled to Medicare coverage
  • Age 66-67 – Social Security full retirement age[3]
  • Age 70 – Latest age to start Social Security
  • Age 70 ½ – Must start required minimum distributions (RMDs) [4]

Whenever you plan to retire, it's important to create a strategy today. By reviewing your personal situation, a financial professional can help you set and work toward a target retirement age.

Get help from a financial professional

» Find out how a financial professional or advisor can help.

National Vital Statistics Reports, Vol. 61 No. 6, October 2012.
If the employer plan allows.
Full retirement age is based on the year you were born. See for details.
If a participant in a qualified retirement plan is still employed and not a greater than 5 percent owner, they are not required to start minimum distributions from that plan until they retire.


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