Collecting a pension in the United States means earning about $1,666 per month on average. Social Security, in addition, adds an extra amount if the couple also decides to collect the spousal retirement benefit. This means that an average pensioner couple earns about $2739 per month. This amount seems sufficient if we calculate the full year, $32,868 per year, but in reality it is not so much money if we take into account inflation and the increase in market prices. That’s why Social Security must do something about it.
According to the Bureau of Labor Statistics, the average expense for an elderly couple is $47,579 per year. Included in this figure are monthly rent, food, car expenses and anything else a couple can afford for an entire year. With Social Security income, this amount of money is very large and it is impossible to live every day with peace of mind.
The biggest problem is that Social Security does not fully take into account inflation. This annual price increase makes it difficult for all pensioners to make ends meet. It is therefore very difficult for an elderly couple to live on an average pension, but it is not impossible.
What can a pensioner couple do with Social Security?
It all depends on the age of the Social Security pensioner couple. Younger pensioners have even more expenses than older pensioners, especially if we are talking about people who can travel and do activities where money is needed. If a pensioner does not move from home, the situation changes because he/she has less expenses as a general rule.
Therefore, the average Social Security benefit may not be enough if we take into account that the average annual expenses amount to almost $50,000. This makes many couples unable to live well every month and in need of extra income, such as a business or continuing to work for more years.
How to get a larger retirement pension?
You can prepare for a larger retirement pension with a few tips. To get a larger Social Security pension, you can:
- Ask for retirement later. If you retire at age 62, you have an Early Retirement Age, which means your pension is reduced by 20% or so. If you wait until age 67, you can have a 100% pension. If you prefer to work until age 70, each year worked will add a little more to your final retirement.
- Get a high salary. Asking for a high salary during the years worked is important to have a good final retirement. The average retirement is made with the 35 years worked with the highest salary. Having years with low salaries makes the average lower.
- Work for at least 35 years before retirement. If you work less than 35 years, your Social Security average will go down. Each year worked under 35 will add $0 to the average, which will reduce the benefit.