When discussing and planning your retirement, there are lots of details to consider in order to make sure that your retirement is not only relaxing and productive but financially stable as well. One important detail is securing Social Security retirement benefits if you are eligible. Below you’ll find some of the more common questions answered which should help you file for social security retirement benefits.
What are Social Security retirement benefits?
Although there are many ways to define it, in essence Social Security retirement benefits are benefits acquired through a government supported retirement program that is funded by a federal income tax. The benefits are paid to American citizens based on age, income earned through an individual’s lifetime and number of years worked.
Things to consider before filing
Before filing, it is important to understand not only how Social Security benefits work but how to maximize them as much as you can. Below are a few things to consider before you start the filing process.
Timing vs. Benefits
The amount in which you receive varies greatly depending on the age at which you file. If you choose to file at 62, you’ll automatically receive a 25 percent cut. It’s important to note that this cut is permanent, not just a onetime deal. If you decide to collect at your full retirement age, otherwise referred to as FRA, at age 66 you’ll receive 33 percent more in benefits. If you wait till you’re 76, then your benefits increase about 76 percent.
Should You Continue To Work While Receiving Social Security Benefits?
If you decide to continue working and earn money before your FRA, be prepared for the possibility of part of your benefit to be temporarily withheld. Here are some examples:
- For every $2 you earn above $15,480 per year you’ll find that $1 will be withheld.
- The year you reach your FRA this amount changes and you’ll find that $1 is withheld for every $3 that you earn over $41,400.
You do, however, receive the deducted money back after your FRA is reached.
Social Security Spousal Benefits
If you’re married at the time of filing, your spouse may be able to receive a benefit based on your work earnings. In order for this to happen though, your spouse must be at least 62 years or older. Essentially what this means is that your spouse is able to receive Social Security retirement pay simply by being married to you.
Now here comes the tricky part. As much as 50% of your ‘primary insurance amount’ can be used as spousal benefit. The amount itself depends on the age of your spouse and whether they wish to receive benefits before their full retirement age of 65. Sometimes however, the retirement benefit for your spouse will be larger than the spousal benefit. If that’s the case, then the Social Security administration will go ahead and pay the retirement benefit for each person.
How to Actually File for Benefits
There are many different ways to file, thus allowing for a bit more ease during the process.
Filing In Person
You can visit your local Social Security office. Just make sure to call ahead of time to make an appointment so you don’t get stuck waiting in line or even yet, sent home to come back at a later date.
Filing By Phone
You can call toll free at 1-800-773-1213. If you are deaf or are hard of hearing, you can call TTY 1-800-325-0778.
You can also find the official application for retirement, spouse’s, ex-spouse’s and Medicare benefits online at ssa.gov.
Things to Remember
There are some keys things to remember when you are getting ready to file.
- First, you must be 61 and 9 months old to apply for any retirement benefits.
- Second, if you are 62 years old already you can start receiving your benefits within the same month as your application.
- Third, it is best to apply for you benefits within 4 months of the date you wish for them to begin, but no sooner.
- Lastly, benefits are not paid in the same month that they are due but rather the month after. Example: if your benefits start during the month of June, you won’t receive your first payment till July.
How do you receive your payments?
There are two ways to receive payment, by direct deposit or by signing up for the Direct Express card program. When your payment is direct deposited, you have the option of choosing what account it goes into and then can withdraw the payment as cash or use it toward a check. If you choose to go the Direct Express route, you’ll be able to use the card to pay for your purchases but will not be able to use the card to withdraw cash. You will however, be able to track how much money is on the card.
What happens if you change your mind?
As with everything in life, things sometimes change. If you happen to change your mind about receiving your benefits after filing, you may be able to reverse the decision. The key is to withdraw your Social Security claim within 12 months of the date you started to receive the benefits. If you wait longer, there is a strong possibility that you will not be granted a reversal.
Keep in mind, you are only allowed one withdrawal per lifetime. Also, if you do decide to withdraw your application, you will be entitled to repay all of the benefits that both you and your family received in that time-frame. It’s best to take a good hard look at whether the paperwork and time is worth it.
Hopefully we have been able to help and give you a little more information about Social Security Retirement Benefits and how to file for them. We do recommend that prior to filing, you consider speaking with a professional to make the best decision for yourself and your family.
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