Retiring can be very pleasant for people who saved up enough money and considered their social security benefits. However, if you don’t plan, you could be out of luck! So make sure to complete these Social Security steps before retirement!
Create A Social Security Account
Social security benefit money is a huge part of every retiree’s budget. Before everything went online and became automated, workers received their Social Security Administration checks straight to the mailbox. Now, there are no statements to read, and by creating an online account on the official website, any American citizen can get an estimated benefit amount at any age. Don’t be the in the 57% who have no idea what their benefit amount is!
One thing to remember: the amount estimated on the website is only for people of retirement age. Citizens born in 1960 or later can claim a full benefit at 67, while others born before 1960 can do it at 66. Those claiming benefits earlier will get about 30% less every month. On the other hand, retirees claiming the benefit later can have a bonus of up to 30% as well. Every soon-to-be retiree should know the age they want to retire at for the best outcome. Moreover, most retiring spouses can combine their benefits for an even better future.
Determine The Budget
After realizing how much they’ll get and when they want to get their rest, retirees should think about their annual and monthly budget. Will the benefit payment be enough to cover the whole month? Usually, they only help with up to 50% of spending when the elderly retire, but it’s solely based on how much they spend. So, they should count how much they plan to spend on living expenses every year, then see if the benefits cover this amount. Afterward, it’ll be clear if they need to wait and save up more, or if there’s enough money to claim the benefits earlier. Perhaps, it’ll be better to cut the living cost and stretch the budget more each year.
Come Up With Plan B
So, your retirement plan now includes social security benefits and it’s all set. Well, it’s best to create a backup plan in case plan A falls through. It’s possible that benefits can be reduced by around 25% by the year 2034, and no retiree would want to go broke at that age. A few years before retirement, any elderly should think about what they can do without benefits. There are a few ways to compensate that payment, but they all involve making more money. Be it now in bonus savings, investing, or later with a fun side hustle – come up with plan B just in case. Take another year to transform your hobby into a job or take up a course. Talk it through with a family or a spouse – it’s a great idea to combine two benefits. It’s never late for a new beginning.
Almost every American will rely on their Social Security benefits every month as they retire. Start thinking about the retirement plan today and ensure a great future as a future elderly.
Sources: Fox Business, MSN.