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Whether you’re going into retirement or have been retired for a minute, having a plan is essential for Social Security. We may be familiar with the basics, but the program is more complicated than we realize. Here the Senior Security Alliance will highlight some truly weird rules that may surprise even the most seasoned retiree.
Here are some key rules that you should know so to better plan for your continued retirement:
Working while Retired
People nowadays often take a “half-retirement,” where they are retired from full-time work but work for a small amount of time for social and financial reasons. If they collect an income while collecting their benefits, their benefits may be reduced. If you are below the full retirement age, your benefits can be reduced by $1 for every $2 you make past the federal limit. However, suppose you are at or above your full retirement age. In that case, you can earn without having a reduction in benefits.
Changing Your Mind – A One-Time Option
You are eligible to claim your benefits at 62, but the full retirement age for many is 67. Furthermore, if you wait till 70, your benefit may be even higher. A lot of people take their benefits at different times. If you feel like you’ve started to claim your benefits too early and can hold off until you’re older, you can defer them. By pausing your benefits, you can receive a higher benefit later. You can only delay once and a year after originally claiming the benefits. Otherwise, you need to pay back the benefits you’ve taken to receive a higher benefit later.
Spousal Benefits – Even If You Never Worked
Spouses can benefit from our hard work, even regarding Social Security. The Spousal Benefit entitles a spouse to a benefit equal to 50% of the benefit of whoever is the higher earner. This doesn’t impact the benefit of the other spouse. The spouse with the higher income must first take their own benefits before the spouse can take theirs.
Work History – Leveraging Benefits
The SSA (Social Security Administration) uses an equation considering your 35 top earning years in the workforce to calculate your benefit. If you have worked under 35 years, your benefit will be smaller. Delaying your benefits and continuing to work may increase your overall benefit.
Social Security is complicated. But knowing the rules makes it easier to navigate. Take advantage of these hidden opportunities; explore all possibilities to make the most of and protect your Social Security benefits.
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