If you’re like most people who’ve started thinking about retirement, you may have already searched online about average savings at retirement or average savings by age to benchmark your progress against your peers. There's another piece of information that's equally important: average retirement age.
Why is it important? For one thing, retirement age statistics can give you additional context for your own retirement planning. Knowing when other people retire — and trends related to retirement — may help you fine-tune your own timeline, set or adjust financial goals and benchmarks, and make better-informed decisions about savings.
This knowledge can also help you adapt to recent changes in the employment landscape. As people live longer, expected retirement ages can shift; many people decide to adjust their career trajectories or consider alternative retirement dates and strategies. Simply put, getting up to speed on retirement age trends is important to personal finance strategy and helping to obtain a fulfilling retirement. This article will tell you about:
Average retirement age in the US
New trends affecting average retirement age
How to choose the retirement age that is right for you
How to prepare for retirement
What is the average retirement age in the US?
There are a few different ways to look at the question, and to give you a better picture, here are some key statistics and trends related to retirement age in the United States over the past few decades.
A 2024 study found that the average retirement age is 62, though most retirees and pre-retirees believe the ideal retirement age is 63.
The average retirement age has increased from age 57 in 1991.
Fewer adults in their 60s are retired. Between 2002-2007, 41% of US adults 60-64 and 76% of US adults 65-69 were retired. However, between 2016-2022, just 32% of US adults 60-64 and 70% of US adults 65-69 were retired.
"Early retirement" has decreased significantly over the past two decades: the percentage of people retiring between ages 50-54 has declined from 9% to 6%, and the rate of people retiring between ages 55-59 has dropped from 19% to 11%.
Due to longer life expectancy, the expected retirement length has increased significantly – from 12.8 to 18.6 years for men and from 16.6 to 21.3 years for women since 1970.
There is a gap between expected and actual retirement age. In 2022, non-retirees expected to work until age 66, while retirees reported an average retirement age of 61.
There are significant retirement age variations by state. For example, the average in Washington, DC, is around 67; in Iowa, Kansas, Maryland, Vermont, and Texas, it’s 65. Arizona, Missouri, and Nevada are at 63; in Alaska and West Virginia, it's 61.
What it means for decisions about retirement
If you dig a little deeper, you’ll see three significant trends starting to emerge:
The average retirement age is on the rise
Most of today’s workers will be working longer than they did 20 years ago
People today expect to work longer
Why are people working longer? There are several reasons.
First, the full retirement age was 65 for most of Social Security's history, but that is gradually rising. In 2022, the full retirement age was set at 67 for those born in 1960 or later.
Second, longer life expectancy means that many people will spend more years in retirement, which will require more savings if they don't want to outlive their money. And more savings usually require extra years spent working. In addition, the Great Recession of 2008, the COVID crisis, and recent inflationary trends may have all taken a bite out of many people's savings and changed their retirement timelines.
While item 7 above may seem like good news — people are retiring earlier than they had expected — it may not be. The discrepancy between expected and actual retirement dates likely has more to do with unexpected hardship, such as a health problem or disability (31%) or due to changes at their company (32%.)
The financial ability to retire is a significant challenge for many Americans, with one 2024 study finding that only 68% of workers and 74% of retirees are confident they’ll have enough money to live comfortably through retirement. Another study found that 25% of Americans over the age of 50 who haven’t already retired expect that they won’t ever be able to, with one in four having no retirement savings.
Regional variations in retirement age suggest that workers in states with more manual labor and manufacturing jobs — as opposed to professional, service or information-based jobs — are more likely to retire early due to the physical nature of their work. These are both important things to remember when considering your expected retirement date.
In any case, the overall trend is clear: most United States workers will have to work more years than in the past to achieve their goal of a financially secure retirement. And that’s essential information for anyone thinking about retirement planning and preparation.
When are you eligible for Social Security and Medicare?
Social Security and Medicare eligibility may be key factors in determining when you retire. You can begin receiving Social Security retirement benefits at the age of 62, but it’s important to remember that the earlier you start receiving benefits, the less your monthly payout will be unless you wait until the age of 67. If you begin receiving benefits at the age of 62, your monthly payout could be reduced by as much as 30%.
Age started receiving benefits | Percentage reduction in monthly benefits | Monthly benefit amount |
|---|---|---|
62 | 30% | $1400 |
63 | 25% | $1500 |
64 | 20% | $1600 |
65 | 13.3% | $1733 |
66 | 6.7% | $1867 |
67 | 0% | $2000 |
Source: https://www.ssa.gov/pubs/EN-05-10147.pdf
Medicare coverage, however, starts at the age of 65. Enrollment begins three months before you turn 65 and lasts for three months after the month you turn 65. You won’t qualify for Medicare until 65, even if you retire early — unless you have a qualifying disability.
What retirement age is best for you?
At what age should you retire? It can be a complex – and very personal – question. The fact is, your ideal retirement age depends on several factors, including financial circumstances, health status, work situation, personal goals, and the preferences of your partner or other family members. Here are some key considerations:
1. Financial readiness
One of the most important factors in determining your retirement age is whether you have saved enough money to support yourself throughout your retirement years. This includes not only your retirement savings (e.g., 401(k), IRA) but also other sources of income like Social Security, pensions, and any other investments or assets you may have. Many financial advisors recommend waiting until you have enough savings to maintain your desired lifestyle during retirement.
2. Health and life expectancy
If you are in good health and expect to live a long life, you may want to work longer to ensure you have enough money to support yourself throughout an extended retirement. On the other hand, if your health is declining or you have a shorter life expectancy, you might choose to retire earlier.
3. Social Security retirement benefits
The age at which you can start receiving your full Social Security retirement benefit varies depending on your birth year. You can start receiving reduced benefits as early as age 62, but if you wait until your full retirement age (which ranges from 65 to 67, depending on your birth year), you'll receive your full benefits. Delaying beyond your full retirement age can yield even larger benefits.
4. Personal goals and lifestyle
Your retirement age should align with your personal goals and the lifestyle you want to lead during retirement. Some people consider retiring early to pursue hobbies, travel, or spend more time with family, while others may find fulfillment in their careers and prefer to work longer.
5. Employer considerations
If you have an employer-sponsored retirement plan or pension, your retirement age may be influenced by your employer's policies and the financial incentives they offer for retiring at a certain age.
6. Debt and expenses
Consider your outstanding debts, such as mortgages, loans, and credit card debt, as well as your ongoing expenses. It's generally advisable to pay off high-interest debt prior to retiring and to have a clear plan for managing your expenses in retirement.
7. Market conditions and economic factors
Economic conditions and the state of financial markets can impact your retirement plans. Retiring during a strong economy may be more advantageous than retiring during a recession.
8. Partner perspectives and family considerations
If you have a spouse, partner, and/or family, you'll probably have to take their opinions and circumstances into consideration. For example, if your partner or spouse is retiring and anxious to transition to a retirement lifestyle, you may want to retire sooner rather than later. On the other hand, if you're helping to support an adult child, you may choose to delay retirement until they can fend for themselves financially.
Personal preferences, demographics, and culture may play a role in this. Women, for example, consistently tend to retire earlier than men—and the gap seems to be growing.
Ultimately, there is no one-size-fits-all answer. When to retire is a highly personal decision that should be based on your individual circumstances and preferences. Consulting with a financial professional can help you make this important decision and create a retirement strategy that can help you meet your goal.
How to be better prepared for retirement
Once you have an idea of when you’ll retire, the next step is to begin — or further — your planning and preparation. How deep a dive you take will depend on when your target date is. Even if it's over a decade away, now is a good time to start retirement strategizing. If you're closer to retirement, your urgency should increase accordingly. Here are some key areas to address:
1. Define your retirement goals
Think about the lifestyle you’d like to have in retirement. Will you stay in your current home? Will you move to a resort location where costs may be higher? Are you planning on extensive travel or costly hobbies? Might you downsize to cut back on expenses? How you choose to live in retirement will, in large part, determine your expenses. And your expenses will determine how much savings you’ll need.
2. Review your financial situation
Even if it's decades away, you should use tax-advantaged retirement accounts to help build your retirement nest egg. But as you get closer to retirement, it's important to have a clearer picture of your financial situation to see if you're on track to meet your goals -- if you need to adjust your savings strategy or approach, you don’t want to wait until the last minute. So, take the time to review retirement accounts and other assets, your investment strategy and results, and reduce your long-term and high-interest debt.
3. Estimate retirement income
How much income can you expect in retirement? For a topline estimate, total your expected income from Social Security and pensions; estimate total savings at retirement, including 401(k)s, traditional and Roth individual retirement accounts (IRAs), and taxable accounts; estimate retirement income from savings and investments; estimate income from other sources such as part-time work; deduct estimated taxes; total your after-tax income.
4. Estimate retirement spending
Estimating your expenses in retirement is central to the planning process. A simple way to do so: Record your current monthly expenses; factor in inflation of about 3% per year; consider any anticipated lifestyle changes that may increase or reduce spending; add in healthcare costs, which tend to increase with age; factor in debt that won't be paid off by retirement age; consider potential purchases, emergencies, and financial obligations, from helping an adult child to buying a new car.
5. Balance your retirement budget
Next, determine how much income you'll have to generate via your savings to balance your budget. Simply subtract non-savings income (Social Security, etc.) from your expenses. If you estimate expenses at $90,000 per year and expect to earn $45,000 from Social Security benefits, pension, and part-time work, you'll have to generate $45,000 (after taxes) from your nest egg to make up the difference.
6. Revisit your saving strategy
If, after completing the prior steps, you feel confident that your current plan will build an adequate retirement fund, keep doing what you're doing! But if you think that you may end up with a shortfall, take some time to review and adjust your plan. You may want to increase your savings rate, make catch-up contributions to retirement accounts (after age 50), or consult a financial advisor.
7. Reassess your health and health insurance
In addition to finances, quality of life in retirement will be determined by the state of your health and the quality of your health coverage. So, stay current on all checkups and preventive care; make lifestyle changes that may improve health and contain medical costs; review health insurance and long-term care plans; get up to speed on Medicare, Medicare Advantage, Medigap, COBRA, and Medicaid.
Remember, as you get deeper into your retirement planning and preparation, you may need the assistance of a professional financial professional, retirement planner, or tax advisor. If so, don’t hesitate to ask for help.
Guardian Can Help
The information provided above can help to inform your retirement strategy and decisions. However, as you get deeper into the planning process or closer to your retirement date, there may be issues that can be reviewed with a financial professional.
If you don’t currently have a financial professional, Guardian can help. A Guardian Financial Professional will listen to your needs, help define your goals, and work with you to better understand the retirement planning process and make decisions that are right for you. Here’s how to find someone near you:
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Material discussed is meant for general informational purposes only and is not to be construed as tax, legal, or investment advice. Although the information has been gathered from sources believed to be reliable, please note that individual situations can vary. Therefore, the information should be relied upon only when coordinated with individual professional advice. Guardian, its subsidiaries, agents, and employees do not provide tax, legal, or accounting advice. Consult your tax, legal, or accounting professional regarding your individual situation.