Social Security payments make up a large part of the income of retirees over 65 in the United States. To be more precise, 9 out of 10 over 65 collect a retirement check from SSA.
And within that group there is a large percentage who only collect a retirement check each month. So if the American population only collects Social Security on many occasions they will need to be aware of how that check is set up.
And in the case of wanting to collect a larger Social Security payment there are several rules to keep in mind. Thus, we find that a retirement beneficiary can lose up to 30% of the check he or she has contributed in the years worked.
Losing such a large percentage can be a very negative thing for a citizen of the United States. It is quite a large part of their monthly income. That is why knowing the rules is so important.
How not to lose 30% of Social Security?
The first thing we must take into account when organizing our retirement is to determine when we want to start collecting Social Security. And the minimum age to do so is 62. But it is not advisable to apply for the benefit at that age.
If we want to retire at 62, we will apply for Early Retirement Age. And this means losing 30% of the money we have contributed as workers. Remember that the 35 years worked with the highest salary are taken into account to set up the check.
In this sense, even if we have a huge work history we will not be able to get too big a check. If we have contributed to get a monthly Social Security payment of $2,500 we will lose 30% of it. So only $1,750 will reach our checking account each month.
For this reason, we should not make the mistake of retiring as soon as we reach the minimum age. In the event that we can wait a little while, the ideal is to do so. If we wait until the age of 67 we will get 100% of the money we have contributed. So we must study our particular case to know if it is really worth waiting or ask for retirement as soon as possible.