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A lot of people have retired in the past few years. Many government employees have elected to end their service because of the pandemic, market instability, the shift in pace and workplace culture, and several other factors.
When it comes to deciding when to retire, many factors will go into the decision – one of which is determining what to do with Social Security.
According to Kiplinger, there are more than 500 different ways to determine when and how to apply for Social Security. Around 80 of those are solely for individuals that are married.
What Should a Retiree Do When Deciding on Social Security?
There’s so much misinformation about Social Security, and many people don’t know their choices. Even an SSA agent may not be aware of all your options. They also don’t know you or your lifestyle, so they’re not well-equipped to assist you in making the best decisions.
We won’t be able to cover all of the aspects of the Social Security system in this article, but we’ll discuss some of the most important things to keep in mind when filing for benefits. Learn how to get a free worksheet to help you calculate your Social Security taxes.
Special Retirement Supplement
You can get the special retirement supplement until you reach the age of 62 if you retire under FERS with 30 years at the MRA or 20 years at 60. As a federal employee, this well-known benefit is intended to bridge the gap between your exit from service and the commencement of your Social Security payment.
Waiting For The Perfect Time To File For Social Security.
Simply because you have the option to take Social Security does not mean you should.
You should be aware of the three primary target milestones for Social Security. The first is when you turn 62 and become eligible. The second is your full retirement age (FRA), ranging from 66 to 67 years old, depending on your birth year. The third is your age, which is 70. Between those dates, you can collect your Social Security payment at any time (excluding disability).
While you can start collecting Social Security at age 62 if you meet the requirements, this is the earliest date permitted (non-disability related).
Depending on your birth year, your full retirement age (FRA) is between 66 and 67. This is when you start receiving your full Social Security income (not the maximum amount). You’ll get whatever you’re entitled to based on the calculations.
A third option is to postpone filing until you reach your full retirement age (FRA).
Why would anyone want to wait? Because you received an annual raise of 8% for waiting until you were 70 years old. There’s no point in waiting until you’re 70; the bonus credits stop at 70, so grab it now if you haven’t already.
These aren’t your only options, but they’re just where you start when planning your retirement. Here are other considerations when deciding when to file for Social Security.
Considerations for Your Health
Another thing to consider is that you may have information about your health that leads you to believe you will not live to be extremely old. If this is the case, it might make sense to start taking Social Security before your full retirement age (FRA).
Consider your family.
If a surviving spouse applies for Social Security, they may be eligible to receive benefits from their deceased partner. If theirs is higher, they can keep it, but they also have the option of acquiring their spouse’s. Because of this, they will lose their own money, so it’s essential to plan for a drop in income (this is where a life insurance policy comes in).
You made a mistake in your application.
If you believe you made a mistake when applying for Social Security benefits, you usually have 12 months to withdraw your application and refund the benefits you’ve received. This might help you return to your original choices, which are ideal for you and your family.
Don’t be too hard on yourself. There is relatively little education about the complexity, and many of the rules are illogical.
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M. Dutton and Associates is a full-service financial firm. We have been in business for over 30 years serving our community. Through comprehensive objective driven planning, we provide you with the research, analysis, and available options needed to guide you in implementing a sound plan for your retirement. We are committed to helping you achieve your goals. Visit us at MarvinDutton.com . Tel. 212-951-7376: email: [email protected]