What You Need To Know About Social Security Benefits

By Doeren Mayhew

Throughout the years, the two main sources of income when Americans retire are social security and pensions from their employers. However, since the prices of every item these days are increasing, the financial support that people may get from these sources may not be enough to sustain all their needs. Social Security support may not be that large in amount while pensions are only given by very few employers.

Because of this, people find out that their personal income on both the retirement and off-retirement accounts are very good financial support upon retirement.

A person is only eligible to receive social security benefits if he is consistent in his contributions amounting to that of at least 10 years. The amount of benefit is not the same for every individual. It is determined by the amount of your contribution and the age at which you choose to receive the benefits.

The good side about this is that the benefits are set to go up with inflation and the bad side is that your earnings in determining the benefits are capped. This just means that those who earn huge income will get less of their usual earnings compared to those whose income is below the level of cap.

Once you reach your age of retirement than you can fully receive your benefits. The usual retirement age is 65 but for those born in year 1938 or much later, the age increases to 67 for those born after the year 1959.

If you want to check out how much benefit you can get, go to the website of Social Security Administration at www.ssa.gov. You can also review the annual statement sent by SSA to your registered address, which they send to you three months before your birthday.

Getting your benefits at an earlier versus later year
You may choose to start getting your benefits at an early age of 62. The only catch is that of course the amount is going to be lesser than what you will be getting once you reach your full retirement age. For instance, you retired at age 62 but your full age of retirement is 66, you will just get 75% of your supposedly benefits once you reach that age. You will increase it by waiting.

On the other hand, if you decide to take the benefit years after your full retirement age, you will receive an increase in payment. Each year beyond your full retirement age equals an additional 8% per month. So, if your full retirement age is 66 and you choose to get your benefit at age 30, you will receive a monthly benefit of 132% of the amount you should have received had you starting getting the benefit at age 66.

Remember that if you will get the benefits earlier, you will be paying less and get more in the process. The reverse will happen if you will opt to delay in getting your benefits. So If you want the benefits to work to your advantage, you have to know when you are going to receive them.

Spousal benefits is also available
Even if your spouse does not have any earnings with Social Security, he or she will still get the benefits because of your record. Your children will also be eligible but this will depend on their age.

For your spouse, he or she will get 50% of your benefits once you have reached your retirement age. You will also lessen your spouse's benefit if you will get your benefits earlier.

Always remember that your spouse may be entitled to his or her own set of benefits as well. If this is the case, then he or she will surely be paid higher. - 23210

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This data is distributed for informational purposes only, with the understanding that Doeren Mayhew is not rendering legal, accounting, or other professional advice or opinions and assumes no liability in connection with its use. Please contact Doeren Mayhew for more information.