Robert is in his early 50s. He has been employed by the same construction company for 25 years. He signed up for his company's 401(k) retirement plan soon after he joined the company and has invested 15 percent of each paycheck since then. His company also contributed "matching funds." Robert's contributions and those matching funds have been growing. Combining his 401(k) and the Social Security benefits he expects, based on his age at retirement, Robert assumed he would have enough money to retire comfortably at age 66. But, what if Robert's future 401(k) earnings don't keep up the same pace as they have in the past? Or, what if these earnings drop? Robert may have to account for these possibilities in his saving plan.
Did you know?
Retirement age for receiving full Social Security benefits used to be 65. But that's changed, starting with people born in 1938. The age you are able to receive full benefits has slowly gone up to age 67 for those born in 1960 and later. That means, for example, that Robert can receive full Social Security benefits when he is 66 years and 6 months. If he chooses to work beyond his full retirement age, when he retires, Robert's Social Security monthly benefit will increase. To find out your retirement age for full Social Security benefits, go to www.socialsecurity.gov/retire2.
Publication Date: September 2009
Page Last Updated: March 13, 2013