Tips for Getting the Most Out of Your Social Security
If you have paid into Social Security all of your life, you deserve to squeeze every last perk out of the benefits that you receive upon retirement. This sounds great, but it can be very tricky without an insider’s understanding of “the system.” These tips will get you started in the right direction, but for the best results, speak to a qualified attorney.
Types of Social Security Benefits
Social security is the government system that provides financial assistance to those who are retired or disabled. As such, it is a foundation of economic security for millions of Americans, and as many as one in four families receives Social Security income. As today’s workers pay into Social Security taxes, the money flows out as monthly income to current beneficiaries. The average retired adult is eligible for $1,300 per month from Social Security, while a widowed mother of two can earn twice that figure.
It is possible to apply for standard retirement benefits based on your own lifetime earnings, or you can apply for spousal benefits to receive financial support based on a living spouse’s lifetime earnings. If your lifetime earnings won’t qualify you and your spouse is no longer living, you may be eligible for survivor’s benefits. However, you can only receive one benefit at a time, and Social Security will automatically provide the largest amount applicable. If you are eligible for more on survivor’s benefits than retired benefits, it’s important to pursue that application.
The Best Age to Claim
Social Security often rewards people for waiting a few extra years to claim their benefits. While “normal” retirement age is considered 67 for those born in 1960 or later. If you’re willing to work longer, Social Security may pay an extra 8 percent for every year past “normal” that you put off your claim, up to age 70. That means by working just three extra years you could enjoy 24 percent higher benefits!
What About Divorce?
Believe it or not, divorce does not always prevent you from collecting spousal benefits. If you were married for at least 10 years but are not currently married, you will qualify for spousal (or survivor’s) benefits based on your ex’s earning record. Once you turn 60, these requirements are no longer enforced and you can still collect regardless of the length of the marriage.
Social Security is a complex yet highly rewarding institution when utilized strategically.