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Social Security Tips
To help Maximize Benefits
There are many rules to follow — in order to maximize benefits . With that in mind , here are some fundamental points that you should know .
1 . Check the wage history on the Social Security statement Social Security payments are based on a person ’ s work history , specifically on the average wage over the 35 highest earning years , adjusted for inflation . A person needs to work 10 years in order to accumulate the necessary 40 Social Security credits for that person or his or her spouse to collect Social Security benefits .
Information about one ’ s wage history can be found on their Social Security statement , which until two years ago was mailed to most adults annually . Not anymore . Mailings are done only once every five years for those under 60 , so clients should set up an account at www . socialsecurity . gov / myaccount where they can view their statement at any time .
Wage errors can be corrected anytime so long as proper proof is provided , but correcting self-employment income errors is another story . There ’ s a statute of limitations . Errors need to be corrected no later than three years , three months and 15 days after end of the year in which the income was earned .
2 . Know the full retirement age Despite conventional references to 65 as the age of retirement , most people who are not yet collecting Social Security today won ’ t be able to collect full retirement benefits until age 66 or later .
WiregrassSeniorsMagazine . com 3 . The benefits of working in retirement Almost 20 % of Americans 65 and older are working , according to the latest data from the U . S . Bureau of Labor Statistics , and a recent Bankrate . com survey found 70 % of non-retired Americans plan to work as long as possible during retirement .
But doing so can affect Social Security payments for those who are not yet at their full retirement age . If they earn more than $ 15,720 this year , every $ 2 above that threshold will reduce benefits by $ 1 . There is no reduction in benefits for those who have already reached their full retirement age .
Earnings , however , are subject to regular FICA taxes , which finance Social Security and income taxes . But if those annual earnings are higher than the lowest earning years included in the 35-year wage history for Social Security purposes , they will be used instead in that calculation . That could increase benefits .
Another benefit of working longer : it could help delay collecting Social Security until age 70 , when benefits are 32 % higher than they are at full retirement age .
5 . Spousal Benefits A nonworking or even working spouse can collect spousal Social Security benefits so long as that person is 62 years old and his or her spouse , who ’ s likely the higher earner , has applied for Social Security .
If he or she has reached full retirement age , the benefit will be 50 % of the higher earner ’ s benefits . At 62 years , he or she would collect about 35 % of those benefits . In either case , the person collecting spousal benefits cannot also collect benefits of his or her own .
As a result of amendments passed in 1983 , the full retirement age ( FRA ) for those born between 1943 and 1954 is 66 ; for those born in 1960 or later , it ’ s 67 . The FRA is 66 plus two months for every year from 1955 to 1959 .
You can , of course , collect Social Security as early as age 62 , receiving 75 % of your full retirement benefit , or as late as age 70 , collecting 32 % more than the full retirement benefit , or at some age in between .
Spouses no longer have the ability to collect benefits from the husband or wife who has filed and then suspended his or her own benefits due to a change in the law last year , but there is still a grandfather provision to consider . Anyone born before Jan . 1 , 1954 and at full retirement age can file what ’ s known as a restricted application to collect their spousal benefit while waiting until 70 to collect a more remunerative benefit of their own , but their spouse must also be collecting his or her own benefits .