Information
Frequently Asked Questions - Retirement
How do they determine my SS payments?
The portion of your pre-retirement wages that Social Security replaces is based on your highest 35 years of earnings and varies depending on how much you earn and when you choose to start benefits. When you work, you pay taxes into Social Security.
Who receives SS benefits?
People who have already retired.
People who are disabled.
Survivors of workers who have died.
Dependents of beneficiaries.
How does SS and your money that you pay work?
The money you pay in taxes isn’t held in a personal account for you to use when you get benefits. We use your taxes to pay people who are getting benefits right now. Any unused money goes to the Social Security trust fund that pays monthly benefits to you and your family when you start receiving retirement benefits.
How much of your retirement does SS supplement?
On average, retirement beneficiaries receive 40% of their pre-retirement income from Social Security. (You should plan other ways to supplement income as well)
Are you eligible?
When you work and pay Social Security taxes, you earn “credits” toward Social Security benefits. The number of credits you need to get retirement benefits depends on when you were born. If you were born in 1929 or later, you need 40 credits (usually, this is 10 years of work).
If you stop working before you have enough credits to qualify for benefits, the credits will remain on your Social Security record. If you return to work later, more credits may be added.
How do I know how much I’ll get each month?
The amount of the Social Security benefits you or your family receives depends on the amount of earnings shown on your record. Regularly checking your Social Security earnings history can help ensure there are no surprises when it’s time for you to start receiving benefits.
**Your benefit will be reduced, if you decide to start benefits before reaching full retirement age.
What is the full retirement age?
Full retirement age is the age when you can start receiving your full retirement benefit amount. The full retirement age is 66 if you were born from 1943 to 1954. The full retirement age increases gradually if you were born from 1955 to 1960, until it reaches 67. For anyone born 1960 or later, full retirement benefits are payable at age 67.
What is early retirement?
You can get Social Security retirement benefits as early as age 62. However, we’ll reduce your benefit if you start receiving benefits before your full retirement age.
What is Delayed Retirement?
When you delay benefits beyond your full retirement age, the amount of your retirement benefit will continue to increase up until age 70. There is no incentive to delay claiming after age 70.
How do I pay SS taxes if Self-Employed?
File Taxes each year. Benefits Planner: Retirement | Calculate Your Net Earnings from Self-Employment | SSA
State or Local Employment
May or may not get reported to Social Security -- depending on whether it offers State retirement or only a pension plan.
Benefits Planner: Retirement | State and Local Government Employment | SSA
Do I pay Taxes on SS Income?
Not Usually. This usually happens only if you have other substantial income in addition to your benefits (such as wages, self-employment, interest, dividends and other taxable income that must be reported on your tax return).
Note: We are not Financial Advisors, Lawyers or Accountants. We offer Financial Coaching Services and Education. The information provided is for general and informational purposes only and does not constitute Financial/Accounting or Legal advise. Feel free to consult your own Advisors . We are not liable for any loss (direct/indirect) that results from your actions based information provided.