Advice on Social Security for Retirees: Claim Benefits Strategically Before Retirement
Social Security benefits play a significant role in the financial planning of retirees in the United States. Here's a breakdown of the average monthly benefits for retirees at different ages, as well as some key points to consider when planning for your retirement.
Average Social Security Benefits by Age
- At age 63, the average monthly Social Security benefit is $1,364.
- This increases to $1,425 at age 64.
- For those retiring at age 65, the average benefit is $1,611.
- At age 67, the average monthly benefit rises to $1,930.
- Retirees at age 69 currently receive an average of $2,040 per month.
- The average monthly benefit for retirees at age 68 is $1,980, and at age 70, it stands at $2,148.
Factors Affecting Your Benefit Amount
- It's important to note that these are averages, and everyone's benefit will differ. It's best to check your own estimated benefit to see how much you can plan to rely on Social Security in retirement.
- Your benefit can change between now and when you file for benefits, especially if you still have a few years left in your career.
- Filing for Social Security benefits before your Full Retirement Age (FRA) will result in a permanent reduction of up to 30%. Conversely, delaying benefits past your FRA will provide a monthly bonus of up to 32%.
- The Social Security Administration calculates your benefit by taking an average of your wages throughout the 35 years of your career that you earned the most.
- Incorrect income information with the Social Security Administration can affect your benefit amount.
Checking Your Estimated Benefit
- To get the most accurate and up-to-date estimate of your Social Security benefit, you should create or log in to your my Social Security account on the official Social Security Administration (SSA) website.
- If you prefer not to create an account, you can use the SSA’s Social Security Retirement Estimator available at www.ssa.gov/estimator.
- Both tools consider your 35 highest-earning years (adjusted for wage growth) to calculate your average indexed monthly earnings, which determines your benefit amount under the SSA formula.
- Your estimated benefits will update based on your actual earnings and changes in Social Security law.
- The estimated benefit as shown on your statements is the amount you'll receive by filing at your full retirement age (FRA), which is age 67 for everyone born in 1960 or later.
Important Points to Remember
- More than 40% of U.S. adults not currently receiving Social Security are unsure of what their future benefit amount will be.
- It's crucial to stay informed and proactive about your Social Security benefits to ensure a comfortable retirement.
In conclusion, understanding your Social Security benefits is essential for retirement planning. By creating or accessing your my Social Security account or using the SSA’s official Retirement Estimator tool, you can get a personalized estimate of your monthly benefits based on your actual earnings record.
- To ensure a comfortable retirement, it's crucial for retirees to consider their personal-finance situation, including the anticipated Social Security benefits, as these play a significant role in their overall financial plan.
- Retirees should be aware that the average monthly Social Security benefits can vary, with the amount depending on factors such as the age at which they start receiving benefits and their wage history throughout their careers. It's important to check these factors through the Social Security Administration's my Social Security account or Retirement Estimator tool to get an accurate picture of their expected benefits.
