When a United States citizen starts working, he or she doesn’t think about retirement. Or at least that’s a common occurrence in most cases, since starting to collect Social Security seems a long way off. But the truth is that without planning, the golden years will not be as pleasant as they would be.
If we don’t take several things into account, we could lose part of our Social Security retirement check. And no one wants to lose some of the money they should be getting once they stop working. So pay attention to everything related to the parameters governing the Social Security check so you don’t lose part of it.
How do you plan for Social Security retirement effectively?
To begin with, the first thing we are always going to keep in mind are three fundamental elements. These three elements are retirement age, years worked and salary during those years. If we maximize these three elements, our Social Security benefit payment will be the best we can get.
To do this, let’s take a step-by-step look at how to get the maximum benefit from these three elements.
Retirement Age
The minimum retirement age is 62. But doing this may be a bit foolhardy on the part of many Americans. If we apply for a Social Security benefit at age 62, we will lose 30% of the money we have contributed.
In order to get the best possible benefit, we have to wait until age 70. Only then could we reach a figure as high as $4,873 in this year 2024. If we do not want to wait that long, the ideal would be to be close to age 67, which is the age of Full Retirement Age, which grants 100% of the money we have contributed.
Years worked
The minimum number of years worked to get a Social Security retirement benefit is 10 years. But it is not a good idea to apply for the benefit after working such a short time. It is much better to wait until you have worked 35 years.
The benefit is calculated on the basis of the 35 years worked with the highest salary. So try to work a minimum of 35 years. Each year not worked means that we add $0 to the average, which makes the Social Security benefit go way down.
Salary as a worker before retirement
If we have a low salary we will have a low benefit. The higher our check as a worker, the more taxes we will pay. And that will mean that we have a better retirement benefit in the future.
So try to have a high salary, work for 35 years and apply for retirement as late as possible so you don’t lose a big part of the money that really belongs to you to enjoy your golden years.