Full retirement age is the reference point the entire Social Security system is built around. The Social Security Administration calculates your primary insurance amount — the benefit you have earned over your working life — and that figure is what you receive if you claim exactly at FRA. Claim earlier and it is reduced; claim later and it is increased. Everything else in the program, from the early-claiming penalty to the delayed-retirement bonus to the earnings test, is measured against this one age. For decades FRA was 65, but a 1983 law gradually pushed it back, and as of 2026 the transition is complete: anyone born in 1960 or later has an FRA of 67.

The cost of claiming early is steeper than most people expect, and it is permanent. The earliest you can start retirement benefits is 62, but claiming at 62 with an FRA of 67 cuts your monthly check by about 30 percent — and that reduction does not go away when you reach FRA. It follows you for the rest of your life, and it follows your surviving spouse afterward, since survivor benefits are based on what the higher earner was receiving. Claiming early is not wrong for everyone — someone in poor health, or who simply needs the income, may be right to start at 62 — but it should be a decision, not a default.

Delaying works in the opposite direction and is one of the few guaranteed returns in finance. For every year you wait past FRA, your benefit grows by 8 percent through delayed retirement credits, up to age 70. Waiting from 67 to 70 raises your benefit by 24 percent, for life, with an annual cost-of-living adjustment layered on top — the 2026 COLA is 2.8 percent. There is no reason to wait past 70, because the credits stop accruing then. For a healthy person, or the higher earner in a married couple who wants to maximize the survivor's eventual benefit, delaying is often the most valuable move available.

If you claim before FRA and keep working, the retirement earnings test comes into play, and it is widely misunderstood. In 2026, if you are under FRA for the whole year, Social Security withholds $1 of benefits for every $2 you earn above $24,480. In the year you actually reach FRA, the test loosens dramatically: the limit jumps to $65,160, and only $1 is withheld for every $3 over it, counting only the months before your birthday. Once you hit FRA, the earnings test disappears entirely — you can earn any amount with no reduction. And here is the part people miss: the withheld benefits are not lost. At FRA, Social Security recalculates and credits them back, so the earnings test is really a temporary deferral, not a permanent penalty.

Two other figures anchor the working side of the program in 2026. The maximum amount of earnings subject to Social Security tax rises to $184,500 — income above that is not taxed for Social Security and does not count toward future benefits. And the full retirement age of 67 applies to retirement and spousal benefits; survivor benefits can begin as early as 60 (or 50 if disabled), under their own rules.

Many retirees are surprised to learn their Social Security benefits can be taxed, and the thresholds for that have not budged in decades. The IRS uses a figure called combined income — your adjusted gross income, plus any tax-exempt interest, plus half of your Social Security benefits. For a single filer, none of your benefit is taxed if combined income is under $25,000; between $25,000 and $34,000, up to 50 percent becomes taxable; above $34,000, up to 85 percent is taxable. For married couples filing jointly, the breakpoints are $32,000 and $44,000. Because these thresholds are not indexed to inflation, more retirees drift into taxation every year — which is exactly why coordinating Social Security with withdrawals from other accounts matters.

It is worth separating two things people often conflate. The 85 percent figure does not mean an 85 percent tax rate — it means that at most 85 percent of your benefit gets added to your taxable income and then taxed at your ordinary rate. A new wrinkle for 2026 helps here: the One Big Beautiful Bill Act created a temporary $6,000 bonus deduction for taxpayers 65 and older (through 2028), which phases out at higher incomes and effectively shields more Social Security income from tax for many middle-income retirees. It does not repeal benefit taxation, despite some of the headlines, but it does soften it.

Know your FRA — 67 if you were born in 1960 or later — and treat it as the anchor, not the target. The right claiming age depends on your health, your other income, your marital situation, and your tax picture. For a healthy higher earner, delaying toward 70 is often the most powerful single move; for someone in poor health or who needs the income, claiming earlier can be the right call.

If you plan to keep working before FRA, run the earnings-test numbers rather than assuming work cancels your benefits. The withheld amounts are credited back at FRA, so the test rarely changes the lifetime math — but it can affect cash flow in a given year, which is worth planning around.

Coordinate the claiming decision with the rest of your tax plan. The years before you claim — especially an early-retirement gap before Social Security and RMDs begin — are often the best window for Roth conversions, and how you sequence withdrawals affects how much of your benefit ends up taxed.

• Assuming full retirement age is still 65. For anyone born in 1960 or later it is 67, and claiming at 65 means a reduced benefit.
• Claiming at 62 by default without weighing the roughly 30 percent permanent reduction — including its effect on a surviving spouse's benefit.
• Believing the earnings test permanently forfeits benefits. Withheld amounts are recredited at full retirement age.
• Overlooking benefit taxation. Because the $25,000/$32,000 thresholds are not inflation-indexed, many retirees owe tax on up to 85 percent of their benefits and never planned for it.
• Making the claiming decision in isolation instead of coordinating it with Roth conversions, RMDs, and the overall withdrawal strategy.