Can Anyone Ever Retire Early Anymore?

At what age are you going to retire? It is a big question. And, no answer is going to be right for everyone. In fact, data on the average retirement age suggests that there is no real average.

What is the Average Retirement Age?

Figuring out the average retirement age is tricky. Different data points and definitions of retirement result in varying ages.

Depending on how you measure, the average retirement age is from around 57-67 with notable outliers.

Average Age to Start Social Security

According to data from the Social Security Administration, based on 2022 claims, the most popular age to start taking Social Security benefits is 66 for both men and women. Until recently, most people started benefits at age 62.

See below for the breakdown of when people start benefits – in order of popularity:

Most Popular – Age 66: Sixty six is the full retirement age for most people, the age when there is no reduction in benefits. And, it was the most popular age to start Social Security with 28.4% of men and 26.5% of women starting.

Age 62: Age 62 is the now the second most popular age to start benefits with 22.99% of men and 24.5% of women having started at this age. (In 2014, a much higher number – 34.5% of men and 39.7% of women – started at 62.)

Ages 65, 67, 68, and 69: Around 13-15% of people started at each of these ages:

• 13.3% of men and 13.4% of women started age 65
• 15% of men and 13.4% of women started age 67
• 13.4% of men and 13.1% of women started age 68
• 13.8% of men and 12.2% of women started age 69

Ages 63, 64, and 70 and greater: These were the least popular start ages with only around 6-9% starting at these ages:

• 6.4% of men and 6.6% of women start age 63
• 6.7% of men and 7.3% of women start age 64
• 8.4% of men and 9.3% of women start at age 70 or greater

Self Reported Retirement Age

The self reported retirement age seems to be getting older. Below are the results of two reputable reports.

According to the most recent Gallup survey, the average reported retirement age is 61, an increase from the start of the 2000s when the age was 59. Non retirees’ target retirement age has increased, from 60 in 1995 to 66 today.

And, the latest research from the Transamerica Center for Retirement Studies finds that:

• 42% of those not yet retired expect to retire at age 70 or older or do not plan to retire
• Only 9% expect to retire at age 66-69
• 22% expect to retire at age 65
• 29% expect to retire before age 65

Retirement Age by Analysis of Labor Force Participation

Analysis of who is working or looking for work may be a more objective measure of retirement age.

Researchers at the Center for Retirement Research (CRR) at Boston College define the “average retirement age” as the age at which labor force participation drops below half. By this measure, CRR estimates that the average age is around 64 for men and 62 for women. However, it does not exclude people who are not meant to be in the workforce like homemakers and the disabled – skewing the number younger.

According to the EPI, perhaps the most accurate way to measure retirement is to “look at the age at which half of the nondisabled workforce has exited the labor force.”

By this measure, the average retirement age is 65.5.

Retirement Age in Your State

U.S. Census Bureau data has been used to figure out the average retirement age by state:

Lowest Retirement Ages: The states where people retire the youngest include:

• Two states where the average age is 61: Alaska and West Virginia
• Seven states where the average retirement age is 62: New Mexico, Michigan, Louisiana, Kentucky, Arkansas, Oklahoma, and Alabama
• Twelve states where the average retirement age is 63: Oregon, Maine, Delaware, Nevada, Arizona, North Carolina, Georgia, Indiana, South Carolina, Ohio, Missouri, and Mississippi

In the middle range, there are:

• Eleven states where the average is 64: California, New York, Washington, Florida, Wisconsin, Illinois, Idaho, Pennsylvania, Montana, Wyoming, and Tennessee
• Fifteen states where the most common age is 65: Connecticut, New Jersey, Maryland, Vermont, Rhode Island, Minnesota, Colorado, New Hampshire, Virginia, Utah, North Dakota, Iowa, Nebraska, Texas, and Kansas

Three states have a surprisingly late retirement age:

• Hawaii, Massachusetts, and South Dakota

The availability of jobs, the health of the populations, income levels, the cost of living and other factors may contribute to the discrepancies between states.

Retirement Ages Around the World

Retirement ages around the world are remarkably similar to those in the United States – though a broader range – 50-68.

China is a real outlier where women retire at 50 and the overall average is 54.

Other countries with relatively low retirement ages include Russia where women retire at 56.5, Indonesia where people retire at 58, and the Philippines where they retire at 60.

Countries with high retirement ages include: Finland where people retire at 68, Iceland, Israel, and Denmark (67).

What’s interesting is that most countries around the world have passed government plans to raise the retirement age as life spans grow.

What is an Early Retirement?

There is no official measure of “early retirement.” However, when we talk about an “early retirement” we generally mean that you have stopped working before the age of 65 and the image of carefree 55-year-olds on the golf course comes to mind.

Pre pandemic, the popularity of early retirement was waning. More people were continuing to work after 55, 65 and even 75.

The trend has reversed. As of the third quarter of 2021, 50.3% of U.S. adults 55 and older said they were out of the labor force due to retirement, according to a Pew Research Center analysis of the most recent official labor force data.

This is a modest, but notable increase in retirement.

What is a VERY Early Retirement?

Believe it or not, one area where early retirement is thriving is among 20- and 30-year-olds. A growing number of young people are devotees of a philosophy called FIRE – Financial Independence Retirement Early.

These people radically strip down what they need to spend money on and focus every aspect of their lives on achieving financial independence.

When Can You Retire?

There are a lot of different ways to answer this question. Do you have enough savings? How much do you need to spend? What sources of retirement income will you have? How will these factors change over time?

The one thing you should have, however, is a comprehensive retirement plan. You want to organize your current financial information and project how you are going to fund the rest of your life, along with back up plans for different scenarios.

The NewRetirement Planner can help you consider every factor to determine the best retirement age for you. There are thousands of scenarios underlying our probability calculations and the tools have earned the title of Best Retirement Calculator from The American Association of Individual Investors (AAII) and CanIRetireYet.

Best of all, this easy to use system puts you in the driver’s seat. You control the inputs and assumptions.