Do Not Claim Social Security If You Can’t Answer These 4 Questions | Personal Finance

2. How much can I expect to collect in benefits?

Next, learn how much you can expect to receive in benefits, so that you can plan, save, and invest better for your future income needs. You may not need to save or invest much if Social Security will provide much of what you need – but that’s not likely at all. For context, know that the average monthly retirement benefit was recently $ 1,661 – about $ 20,000 per year. If you earned more than average in your working life, you’ll receive more, but probably not as much as you’d expect. The maximum benefit, for those who earned the maximum amount over 35 years of working, was recently only $ 4,194 – about $ 50,000 per year.

You can get a good estimate of your future Social Security benefit by visiting the SSA website and setting up a “my Social Security” account, for free. Once you do so, you’ll be able to pop in any time to see the SSA’s records of your earnings and your projected benefits. (Note that if you’re still far from retiring, the estimates might change a lot as your career and earnings evolve.)

3. When is the best time to start collecting benefits?

If you’re not pleasantly surprised by how much you can expect from Social Security, know that there are some things you can do to increase your Social Security benefit checks. A major strategy is to delay starting to collect them. You can start collecting as early as age 62 and as late as age 70. Starting before your full retirement age will shrink your checks (though you’ll collect more of them), while delaying beyond it will make them about 8% bigger for each year you delay. This is a powerful strategy for many, but not all, people. If you can keep working beyond your full retirement age and you stand a good chance of living a longer-than-average life, the delaying strategy can serve you well. But if your family is generally short-lived, or you’re not in great health, or you simply need the income soon, then it’s not so terrible to start collecting early.

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