Social Security's full retirement age is increasing in 2025: What to know
Published On Dec 18, 2024, 1:36 PM
Social Security's full retirement age (FRA) is set to rise to 66 years and 10 months in 2025 for individuals born in 1959. This change is part of a gradual adjustment initiated in 1983 that will ultimately see the FRA reach 67 years for those born in 1960 or later. While beneficiaries may opt to start receiving Social Security benefits as early as 62, doing so will result in a permanent reduction of their monthly payments. Additionally, many recipients will get a 2.5% cost-of-living adjustment (COLA) in 2025, reflecting inflation concerns, although this is the smallest adjustment since 2021. The rising FRA and limited COLA adjustments may impact retirees' financial planning and create challenges as the Social Security trust fund approaches potential insolvency by 2033, which could lead to significant benefit cuts.
Stock Forecasts
SDY
Negative
With the anticipated increase in the full retirement age and limited cost-of-living adjustments coming into effect, we may expect a negative sentiment toward businesses that heavily rely on older consumers, such as certain healthcare and retirement service companies. The impending fiscal pressures on Social Security might lead to reduced spending power among retirees, affecting companies that cater to this demographic. Overall, the anticipated changes could weigh on sectors tied to retirement planning services, healthcare, and consumer goods aimed at seniors.