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Understanding Social Security benefits before retiring

A lot of different factors go into Social Security benefits that add up throughout your entire life. It’s best to understand them before retirement.

Social security cards representing benefits for the retired

When you finally retire and collect the benefits, previous decades went into building up what you end up getting.

Currently, 64 million Americans collect Social Security benefits.

Everyone will see a 5.9% increase in their checks in 2022.

This is the highest increase in almost 40 years.


Make sure you pay attention to your Social Security statements

If you want to plan your retirement, looking at your statements before retirement is a good idea.

There is an online portal through the Social Security Administration where you can see what benefits you may qualify for.

It also offers information on what you need to do for certain benefits.

The portal tells you what you may get if you choose to retire early at 62, or later at 70.


Related: COLA: Social Security recipients need more money

Understand how age impacts your Social Security benefits

Understand the consequences or rewards for choosing to retire at certain ages.

You can retire as young as 62, but you will lose up to 30% of your overall benefits.

By waiting until your full retirement age you can get your full benefits.

If you wait until age 70 your benefits will increase for each year you waited between your FRA and 70.

Once you claim that’s what you’re paid until your death.

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Related: Social Security Star Newsletter for January, 2021

Make sure you qualify when it’s time to retire

You need 40 credits to qualify.

Those are earned throughout your working life while you’re being taxed.

Extra credits don’t get you extra retirement money, they just make you eligible.

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