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62 Vs 67 Social Security
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June 21, 2024 9:55 pm
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8 min read
62 Vs 67 Social Security – Social Security is a federal government benefit program designed to provide a source of income for retirees and for those whose spouses have died. Most jobs deduct Social Security tax from your paycheck, and your Social Security benefit depends on the number of years you’ve worked and how much you’ve earned.
Social Security benefits are not intended to be your only source of retirement income. You may need other savings, investments, pensions or retirement accounts to make sure you have enough money when you retire. (There are also Social Security benefits for people who cannot work because of disabilities, but this article is primarily about Social Security as a source of income for retirees.)
62 Vs 67 Social Security
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You. You are entitled to social security benefits if you are 62 or older and have worked and paid social security tax for 10 or more years. Some jobs—such as state and local government positions—do not pay Social Security taxes and therefore do not contribute to eligibility.
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Your current or former husband. Social Security benefits may be available to a spouse — even if they haven’t worked or paid Social Security taxes for 10 or more years — depending on your marital status. The Social Security Administration (SSA) will take into account your work history and Social Security taxes to determine eligibility and the benefit.
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According to the SSA, people in non-marital legal relationships, such as civil unions or domestic partnerships, may be eligible for the same benefits as married people.
Your children. They may be entitled to a monthly allowance if they are unmarried and under 18 years of age (or if they are 18 or 19 years old and in primary or secondary school) and are retired or disabled; they may also qualify if they have a disability.
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You can apply for Social Security online at ssa.gov/apply. The four main types of social security benefits:
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Spousal benefits are available to spouses age 62 or older who do not work or earn enough credits to qualify for Social Security alone. The maximum payment a spouse can receive is half of the benefits to which the spouse is entitled at their full retirement age.
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Meanwhile, when a spouse dies, the surviving spouse has the right to apply for survivor benefits at age 60. The benefit is reduced if the survivor leaves before full retirement age and they can file their own Social Security benefits. when they qualify (at age 70) if their benefit is higher than the benefit of the rest.
People who have been married for 10 years or more – and divorced and never married – can also be entitled to spouse’s benefit and survivor’s benefit.
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Your Social Security benefit is calculated based on the Average Indexed Monthly Earnings (AIME) for 35 years of your earnings. This average is used to determine the Primary Sum Insured (PIA), which is the basis of your benefits.
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To calculate the PIA, the SSA determines three parts of the AIME that will be used in the calculation. (These intervals help ensure that benefits are evenly distributed among the nation’s workers.)
For example, here’s how Social Security benefits would be calculated using the PIA and the hypothetical AIME of $5,000 for a worker retiring at full retirement age in 2024:
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You can check your Social Security account to see your benefit amount. Your online Social Security information provides secure and easy access to retirement, disability, and survivor benefits statistics. You can easily create your own Social Security account at ssa.gov/myaccount.
Your full retirement age is a time between ages 66 and 67 that the SSA uses to determine your benefit amount as well as your family’s benefits. Regardless of your full retirement age, your payout will be higher the longer you wait to use it, up to age 70.
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If you were born on 1 January, you must refer to the previous year to determine your full retirement age.
You can start receiving Social Security benefits before your full retirement age, as early as age 62 — but if you start early, your benefit will be less than if you wait until full retirement age. Your benefit is reduced by 5/9 of 1% for each month between your retirement date and your full retirement age, up to 36 months, then by 5/12 of 1%. This reduction is permanent – you will not be entitled to an increase in benefit when you reach full retirement age.
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Although your monthly benefit will be lower, you may receive the same or more total lifetime benefits as you would if you waited until full retirement age. That’s because even if you get less per month, you can reap the benefits in the long run.
The same advice applies if you withhold your pension benefits after your full retirement age. Your benefit increases indefinitely by a percentage until the maximum age of 70. For anyone born in 1943 or later, the monthly percentage rate is 2/3 of 1% or an annual percentage rate of 8%.
Social Security Benefits Are Modest
The following chart shows how much a $2,000 monthly benefit taken at full retirement age of 67 would be if taken earlier or later than full retirement age. For example, according to this chart, a $2,000 benefit would be $1,400 if taken at age 62 and $2,480 if taken at age 70.
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The example above uses the maximum benefit amount for 2022. For someone whose full retirement age (FRA) is 67, it shows the amount of deferred income and the deferred benefit. (This is sample data for illustrative purposes only. An individual’s monthly benefit will vary based on year of birth, work history and other factors).
On their interest. This usually happens if you receive other significant income – including salary, income from self-employment, interest, dividends and other deductible income reported on your tax return – in addition to your benefits.
According to the SSA, you are required to pay taxes on up to 85% of your Social Security benefits if you:
Can I Rely On Social Security When I Retire?
You can work and receive social benefits at the same time, but there is an annual earnings limit on how much you can earn and still receive benefits if you are under full retirement age. (In 2023, the amount is $21,240.) Once you reach full retirement age, there is no limit to how much you can earn and still receive benefits.
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To set yourself up for a successful retirement, it’s important to work with a financial advisor to better understand your retirement income and to develop a retirement plan. Members have free access to a CFS
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CUSO Business Services, LP does not provide tax advice. For such guidance, please contact a qualified tax professional.
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Non-deposit investment products and services are offered by CUSO Financial Services, L.P. Products offered by CFS: are not NCUA/NCUSIF or otherwise federally insured, are not guarantees or obligations of the credit union, and may involve investment risk with possible loss of principal. Investment agents are registered by the CFS. The credit union has entered into a contract with CFS to provide investment products and services without deposits to credit union members. Break-even helps you know when to choose your benefits. Silvur, a free backup tool, makes it quick and easy.
Silvur allows you to quickly and easily calculate your break-even point – the best time to start receiving Social Security benefits for your specific financial situation. (Shutterstock/wavebreakmedia)
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This post is sponsored and contributed by Brand Partner. The views expressed in this post are those of the author.
While almost everyone looks forward to a comfortable and relaxing retirement, navigating your Social Security benefits can be a challenge. One of the biggest hurdles for people planning their retirement is deciding when to stop working and when to start receiving Social Security benefits. Fortunately, Silvur, a free retirement planning tool, helps you calculate the best time for you to choose your Social Security benefits based on factors including your age, marital status, general financial situation and more open.
Another factor to consider when deciding when to receive Social Security benefits is your retirement age. Your zero point is the point in your life where the amount you would receive by choosing to take your benefits early (at a reduced rate) equals
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