Core Insights - The ideal retirement age for most American retirees and pre-retirees is considered to be 63, with the average retirement age currently at 62, which aligns with the earliest age for claiming Social Security benefits [2][3] Group 1: Retirement Age Considerations - A significant portion of pre-retirees (35%) report insufficient retirement savings to retire comfortably at their ideal age, and 34% express concern about potentially outliving their savings [3] - While retiring at ages 62 or 63 is popular, it may not be ideal when considering various factors that influence retirement success [3] Group 2: Financial and Health Factors - Social Security benefits can be approximately 30% lower if one retires at 62 compared to the full retirement age of 67, which can significantly impact retirement lifestyle [5] - Medicare eligibility starts at age 65, leading to potentially higher private insurance costs for those who retire early [5] Group 3: Longevity Considerations - The overall life expectancy in the U.S. is 78.4 years as of 2023, but many Americans can expect to live into their 80s or 90s based on various demographic factors [6]

Core Points - The retirement age in the U.S. varies for different benefits, with eligibility for Social Security at age 62 and penalty-free withdrawals from 401(k) and IRA accounts at age 59½ [1][2] Social Security Benefits - Full Social Security benefits are available at full retirement age, which is 67 for individuals born in 1960 or later, with the option to start receiving benefits as early as 62, albeit at a reduced rate [3] - Delaying Social Security benefits past age 62 increases the monthly benefit by 8% for each year until age 70, resulting in a maximum benefit at that age [4] - Starting benefits at age 70 can yield a monthly benefit approximately 77% higher than starting at age 62, though this decision depends on various personal factors such as health and marital status [5] 401(k) Withdrawals - To withdraw from a 401(k) without penalties, individuals typically must wait until age 59½, with exceptions for permanent disability [6] - Withdrawals from traditional 401(k) accounts are taxable as ordinary income, and a 10% early withdrawal penalty generally applies [7] - For Roth 401(k) accounts, contributions can be withdrawn tax-free after age 59½ if the account is at least five years old, while early withdrawals of earnings incur taxes and penalties [8] Rule of 55 - The IRS provision known as the rule of 55 allows penalty-free withdrawals from a 401(k) if an individual loses their job or quits in the calendar year they turn 55 or later [9] Required Minimum Distributions (RMDs) - RMDs from 401(k)s and other retirement accounts must begin at age 73, increasing to age 75 in 2033, with Roth 401(k) account holders exempt from RMDs starting in 2024 [12] IRA Withdrawals - The retirement age for IRA withdrawals is generally 59½, with similar exceptions as 401(k) accounts [13] - Traditional IRA distributions are subject to ordinary income taxes and a 10% early withdrawal penalty if taken before retirement age [15] - Roth IRA withdrawals are tax- and penalty-free after age 59½ and five years of account ownership, with contributions withdrawable at any time without penalties [16] Additional Retirement Income Sources - Pensions, though less common, can provide guaranteed retirement benefits based on years of service [18] - Taxable investment accounts allow for penalty-free withdrawals, with profits taxed at favorable long-term capital gains rates if held for over a year [19] - Home equity and rental properties can serve as additional income sources during retirement [21]