The Social Security Act of 1935 made 65 the age America retired. For most of the century that followed, employers, pension funds and workers planned around it. The number is still printed on Medicare cards. Nearly everything else about retirement has moved.
Social Security was first. In 1983, Congress began raising the full retirement age, and the phase-in ended this year: anyone born in 1960 or later must wait until 67 for a full benefit. Benefits can still begin at 62 at a permanent reduction, and waiting until 70 increases the monthly check.
The program’s finances are tightening on their own schedule. In June, Social Security’s trustees projected that the retirement trust fund will exhaust its reserves in the fourth quarter of 2032, about three months earlier than last year’s estimate. If Congress does not act, incoming payroll taxes would cover about 78% of scheduled benefits, an automatic cut of roughly 22%. The options before lawmakers include raising the cap on taxable wages, raising the payroll tax rate or changing future benefits.
Workers are adjusting. In this year’s Retirement Confidence Survey from the Employee Benefit Research Institute and Greenwald Research, workers' confidence that they will retire comfortably fell 6 points, to 61%. Nearly a quarter changed their target retirement age in 2025, most of them pushing it later. “Retirement confidence has clearly softened this year and the data show why,” said EBRI's Craig Copeland.
Plans and outcomes sit far apart in the same survey. The median worker expects to retire at 65. The median retiree left work at 62, and nearly half retired earlier than they had planned.
Responsibility for retirement income has shifted from employers to employees. In 2010, 20% of private-sector workers had access to a traditional pension, which pays a set amount for life. By 2025, 14% did, according to the Congressional Research Service. Access to defined contribution plans such as 401(k)s rose from 59% to 70% over the same period. A pension left the investment risk with the employer. A 401(k) leaves it with the worker.
The savings in those accounts are modest. Vanguard’s 2025 How America Saves report, covering 2024, put the median 401(k) balance for participants 65 and older at $95,425. The average, pulled up by high earners, was $299,442.
Illinois has tried to reach workers whose employers offer no plan. Illinois Secure Choice, the state’s automatic IRA program, held about $360 million across 170,054 funded accounts as of June 30, according to the Plan Sponsor Council of America. The average balance was $2,119.
Confidence in the public programs is slipping too. Only about half of workers in EBRI’s survey are confident Social Security and Medicare will provide benefits of equal value in the future, and seven in 10 retirees are concerned the government will change the system. “Retirement planning is becoming more complex for Americans across life stages,” said Lisa Greenwald of Greenwald Research.
For anyone born after 1960, retirement is now a series of dates: 62 for the earliest Social Security check, 65 for Medicare, 67 for a full benefit and, for the typical retiree, 62 as the last day of work. The decisions about when to claim and how far savings must stretch happen across those five years. Sixty-five is still on the Medicare card, but it no longer marks the end of a working life.