What does FRA stand for?

FRA stands for Full Retirement Age, which is a crucial concept within Social Security policy. This age is significant as it determines the age at which a person may first become entitled to full or unreduced retirement benefits. The Full Retirement Age varies depending on a person's birth year, currently falling between ages 66 to 67 for individuals born in 1943 to 1954 and gradually increasing for those born later.

Understanding FRA is essential for beneficiaries when planning for retirement, as claiming benefits before reaching this age can result in a permanent reduction in monthly payments. Conversely, delaying benefits beyond FRA can lead to increased monthly benefits due to delayed retirement credits, highlighting the importance of understanding this term in the context of retirement planning.