Social Security And Your Retirement

Social Security And Your Retirement

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Social Security is a major element of most peoples retirement plans. According to recent surveys, most people that are retired receive at least 40% of their income from Social Security payments. Although it doesnt make a lot of sense to rely exclusively on Social Security payments to get you through your retirement years, the importance of this source of income should not be discounted.

Social Security Eligibility

In order to be eligible for Social Security payments when you reach the age of retirement, you must have at least 40 credits. The Social Security Administration allots credits to each person based on how much they work over a period of time. To get 40 credits takes about ten years of working. The amount of your benefits is based on your average pay over 35 years.

Spouses will get 50% of what you qualify for, unless their own benefits would amount to more and your spouse will qualify for benefits once they reach retirement age, even if you are no longer living. Your benefits will also cover a divorced spouse if you were married for at least 10 years.

Social Security and Early Retirement

Although you can start getting Social Security benefits when your reach the age of 62, your benefit amount will only be 75% of what they would be if you waited until you reached full retirement age. Your spouse will only get 35% of your benefit amount when they reach retirement age, instead of 50%.

In addition to this, if you work after you start collecting Social Security benefits, the SSA will deduct one third of what you make over the allotted amount you are allowed to earn each year.

The Social Security website offers a calculator to help you find out what your full retirement age is, as this will vary according to the year you were born.

Before you decide to start collecting your Social Security benefits early, look at your income to see if it is really needed or can you hold off for a few more years. The longer you wait to collect benefits, the more benefits you will receive.

About the Author:
James A. Miller is a leading provider of expert estate planning guidance in Worcester, MA. For more information on retirement and other estate planning services, visit our website.



Article Originally Published On: http://www.articlesnatch.com


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