Posted on 11/27/2018 10:46:01 AM PST by Red Badger
Social Security serves as a lifeline for the millions of seniors who rely on it to pay the bills. If you're eager to make the most of your benefits, all the while avoiding unwanted surprises at present, here are a few key mistakes you'll want to steer clear of next year. 1. Not knowing your full retirement age
Though your Social Security benefits are calculated based on your lifetime earnings, the age at which you first file for them can cause that number to change. If you want to avoid losing out on benefits, you'll need to wait until you reach full retirement age, or FRA, to claim them. However, that age can change based on your year of birth.
If you were born in 1953, you'll reach your FRA of 66 in 2019, and you'll therefore be entitled to collect your full monthly benefits without a reduction. But if you were born in 1954, you'll have to wait until the following year to be eligible for full benefits.
Keep in mind that if you were born before 1958, you'll be allowed to claim Social Security in 2019, since the earliest possible filing age is 62. Remember that any time you take benefits ahead of FRA, you reduce them to some extent. Furthermore, since folks born after 1954 have a later FRA than those born in or prior to that year, it's important to understand the ramifications of filing at various dates. You can use the following table to see when you'll reach FRA based on your year of birth:
_______________________________________________________________________ Year of Birth Full Retirement Age
1943-1954 66
1955 66 and 2 months
1956 66 and 4 months
1957 66 and 6 months
1958 66 and 8 months
1959 66 and 10 months
1960 67
DATA SOURCE: SOCIAL SECURITY ADMINISTRATION.
_______________________________________________________________________
2. Not accounting for taxes on more of your earnings
Though many people regard Social Security as a welfare program of sorts, the truth is that those benefits are earned by paying into the system and racking up enough lifetime work credits to quality for retirement income down the line. Therefore, while you might grumble when you see that a portion of your take-home pay is lost to Social Security taxes, you should, at the same time, recognize that you're paying into a system that will provide for you when you're older.
That said, the income cap at which Social Security taxes are applied is increasing in 2019, which means if you're a higher earner, you'll lose a bit more money than in 2018. For the current year, the maximum taxable income for Social Security purposes is $128,400, but come next year, that limit will increase to $132,900. This means higher earners will be on the hook for taxes on an additional $4,500 of income.
If you're a salaried worker, you'll be responsible for paying a 6.2% tax on that extra $4,500 for a total of $279. If you're self-employed, though, you'll pay double that amount for a total of $558. Be sure to plan for this expense accordingly to avoid getting caught off guard. 3. Not fighting for a raise
The more you earn during your career, the higher a benefit you stand to collect in retirement. Therefore, if you're not making what you should be making at your job, you'll need to speak up about getting a raise.
Of course, you shouldn't approach that conversation blindly. Rather, do some research beforehand to understand what folks with your job title are making, and see how your salary compares. If you're earning well below the average, that's reason enough to get that data in front of your boss. Additionally, map out a list of ways you add value to your company, whether it's by maintaining specialized skills or simply going above and beyond on a consistent basis. All of these are arguments in your favor, so don't hesitate to vocalize them.
The moves you make next year could affect the amount of money you get from Social Security. Avoid the above mistakes, and you'll be better positioned to maximize your benefits while staying away from unpleasant tax-related surprises.
I believe the FRA will continue to climb in order to keep the system solvent over the long term. I see it getting to at least 72 within my lifetime.
Does anyone know the unquestioned experts to consult with ref AS? Anyone out there with a undisputed good reputation? And not just someone trying to sell an annuity.
that is correct. It works best if both spouses are at or near FRA and qualify otherwise.
I looked at this and looked at this an I kept thinking, the USA is broke and we are doing this ? are we stupid ?
Here’s a decent explanation.
https://www.thebalance.com/social-security-rules-for-restricted-applications-2388915
the book I mentioned in my prior post is a “must have”...
good luck
happy hunting...
I am 58 and retiring in February.
Got a decent pension and almost no expenses. When the misses get to be 62, we’ll start taking hers, and when I do, we’ll probably start taking mine (depending...if we can wait longer, we will).
I want my money ASAP. Not waiting until 66-67 for just a few dollars more.
Thanks, I appreciate your help.
Many people say to take it at 62 and invest it.
u r welcome...just hanging together...
The determining factor is whether you need the money. If you need the money, it is best to wait because you will need the higher monthly income as you get older and can’t work (as opposed to won’t work).
If you don’t need the money, then take it early and invest it. If you live to 72 and don’t touch it, you come out ahead assuming a 10% ROI.
Yep, that’s the way it worked. Until I started SS last June, I was getting 1/2 the amount of my wife’s SS.
Had to give it up when I applied for my own, though.
That’s that’s experts reference Social Security. Who are the unquestioned experts in the field
So people like me, born in 1954, start Medicare next year (at age 65) , but have to wait another year for FRA Social Security?
Stylin19a...Thank you for your service. My oldest brother is a Vietnam Vet as well.
Not me. I stay away from such types...................
I started at 68 (waited until Jun with Oct bd) and got a 10 grand ‘bonus’ - guess they have to go back to the start of the year??
B 1939, First WH was in 1953 and went full board in 1992, so I am making out pretty decent and while realizing I may just ‘get the call’ this evening, still going 85% and see no signs of stopping.
Not bad considering around 50 years ago we were all sitting around the campfire saying we would NEVER see a dime of SS....
Used to figure a good line was
“What lady wouldn’t be happy with a gentleman able to work full bore at 75-80.....UNLESS, of course, he HAS to work at 75-80 to survive...”
“Independent living quarters are VERY expensive in my area-—great places to “end up”——if you can afford them.”
What kind of numbers do they quote in your area? My mother’s independent living apartment is $4,000/month - with the central dining room meal service and housecleaning/laundry included and about $300 of minimal “care service” included. We negotiated $1,000/month off when she moved in so most residents are paying $5,000. My mother is 101 and is fortunate that her pensions and SS almost pay for this. Yes, being the age she is she got a good, long income stream out of those retirement benefits, with no sign she is fading yet.
you are welcome.
so, are you looking at this the same way as I did ? and that is ...are we nutz ?
P.S. you can do all this online. What we couldn’t do online is, have taxes taken out, if you need to. I had to go into the local SS office and have that done.
Welcome Home to your brother....Never forget.
FreeRegards
More good news..."if an applicant files for spousal benefits after reaching his or her full retirement age, the applicant can get up to six months' worth of back benefits. But, you have to ask, they're not going to offer it to you..."
yes
thanks for the link
Have fun !
Most people don’t understand that you actually get a year older the day before your birthday. It makes sense if you look at it this way. If you are born on Jan. 1, on Dec. 31 you are a year old—since a year is Jan 1–Dec. 31. The same holds true, of course, for any day you are born.
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