In life, there are several important moments that depend on a decision. In the United States, one of these vital moments is retirement age. Depending on the retirement age we choose, we will have better or worse golden years. Still, age may not matter as much if we have a good plan when applying for Social Security.
With the arrival of good spring weather, many people think that when it comes to applying for retirement age, any time is a good time. This is not always the case, as applying for Social Security requires planning ahead. Without good planning we can run into financial problems in the future.
So we need to plan every step before we start collecting Social Security retirement. By doing it right and doing it early, we can be very close to the maximum check we can get. By applying for Early Retirement Age we can’t get the maximum $4,555, but we can have the maximum amount within our capabilities.
How to plan for the Early Retirement Age?
In order to get the maximum benefit from the Early Retirement Age there are two concepts that we need to understand. The first of these concepts is that the Social Security check depends on our work history. The second of the concepts is that when we apply for Early Retirement Age we will have 30% of the check that we have actually contributed.
Therefore, there are two maximum concepts that we must consider when we are planning to obtain Social Security:
- Work as long as possible.
- Having a good salary during those years of work.
In terms of years worked, we should reach 35 years of contributory service before thinking about applying for a Social Security retirement check. Any years worked below this figure will cause $0 to be added to the average check. This will cause you to see a huge reduction in your monthly payment.
On the other hand, salary is critical if we want to have good Social Security. The higher our salary, the more taxes we will pay. At the end of the day, Social Security comes from taxes, so more taxes means better monthly check.
Things to Consider Before Applying for Social Security
However, not everything depends on the Social Security check. If we want to apply for Early Retirement Age and have great golden years, there are several things to keep in mind. First of all, we can’t apply for the monthly SSA payment without having savings.
Saving money every month must become a primary goal if we want to apply for Early Retirement Age. Actually, even without applying for the ERA we should save money monthly, but with this type of pension it becomes more necessary to save.
In addition to this, we can also look for alternative savings sources. This way, we will have more money to enjoy the golden years. We could set up a company that generates money every month. Another option is to sell everything we don’t need after we apply for retirement.
Eliminate expenses during retirement
Being able to live well during retirement does not only depend on earning a lot of monthly income. Besides that it is also important not to spend more money than necessary. To do this, we should look not only at how much money we earn per month but also how much we spend.
Many superfluous expenses, such as cable TV, can be easily eliminated. This will save us many dollars a month and give us more money for the things we need.
Using public transportation and giving up gas, insurance and car payments can make a huge change in our economy. Also, in our retirement time it may be a good idea to stop driving and enjoy the road more through the use of public transportation.