Social security is a retirement program in America that is well known about. The more knowledgeable you are about how it works the more you are likely to get from it. For a large population of Americans the social security is a critical monetary support. Surveys conducted have shown that the greatest population of people in retirement heavily rely on social security to cover their major expenses every month. Despite the social security being a saving grace to many Americans there is still that segment of the population that does not fully comprehend how social security works. Lack of having the proper and relevant information in regard to social security might result to you and your family losing hundreds or thousands of retirement funds.
How do I qualify to receive Social Security benefits?
Many people assume that simply being an American citizen qualifies an individual for the social security program. This is a misconception, the program is not a right that every citizen must be granted. On the contrary there are certain factors that determine if you qualify to get these benefits once you retire. An individual needs to have earned at least forty work credits throughout their lifetime. In a single year the maximum work credits that can be received are four, therefore the least number of years an employee can work before they qualify for retirement benefits in the social security program is ten years. The qualification criterion varies such as for disabled individuals or families of deceased employees.
When can I begin receiving benefits?
In most cases individuals can start receiving social security benefits as early as sixty two years while some might do it later. If an individual wants to start receiving their benefits from the social security program once they hit sixty two years of age they should make an application to the program administrators three months prior to turning sixty two. It is however also possible to receive the benefits earlier that sixty two in special circumstances such as those of a deceased employee. The widow can start receiving the social security program benefits as early as fifty or even sixty years of age. Another special circumstance is that of disabled individuals, these individuals can start collecting their benefits at any age as well as their off springs that depend on them.
How much do benefits grow annually if I wait?
In as much as the benefits of social security can be reaped as early as sixty two years there are more benefits if you withhold from receiving the benefits for a while longer. There is an eight per cent increment on your benefits every year that you hold off. The 8% increase in benefit starts to be calculated once an individual attains sixty two years of age and it ceases once an individual hits seventy years of age. The increase is notable even in every single month that you wait, for instance after about three months the benefits can have an increment of about 2%. Patience is the key to give a boost to your social security benefits.
What’s my full retirement age, and why is it important?
The full retirement age is estimated using the year you were born which gives the age that the social security program administrators consider appropriate for individuals to receive their retirement benefits. The standard age that is mostly considered ideal for retirement ranges between sixty five to sixty seven years old. It is important to learn when you are expected to retire so that you can decide if you want your benefits to be raised permanently or reduced. When individuals claim their benefits before they have reached the retirement age their monthly benefits are lessened by about 30% at most and at least 25%. While individuals on the other hand wait till they are seventy years of age to claim their retirement benefits they might end up increasing their benefits by twenty four to thirty two per cent.
How are Social Security benefits calculated?
There are four factors that need to be put under consideration when calculating the benefits you will receive from the social security program. The expected full retirement age, the history of your earnings, the work history and the age which you are claiming the benefits are the four factors that you should use to calculate an estimate of the amount you will receive once you retire from the social security. The day you were born is out of your control hence cannot be changed so the full retirement age is already established.
What percentage of working wages does Social Security replace?
The social security program is designed in such a way that the amount compensated to the individual is about forty per cent of what an average worker earns. This percentage might therefore turn out to be a bit steep for individuals who earned small incomes during their working years and slightly less to individuals who earned high incomes.