The United States Social Security Administration’s funding may run out sooner than many experts have predicted. For that reason, many Americans have begun to consider early retirement. This may be a recommended practice in some cases, but not in others. It all depends very much on each citizen’s retirement situation.
Although applying for Early Retirement Age check takes away some of the money contributed is not the same for all Americans. The work history of each citizen is totally different and for that reason a citizen with a high salary is not the same as a citizen with a lower salary. So study your case before making a hasty decision.
Possibly we will face cuts in the check of the future United States retiree, yes. But we must be very careful with the decisions taken, since the cut is not yet 100% certain and we do not know the amount it will amount to. Therefore, we must think very carefully before making the last decision, which will be final in many cases.
Is it better to ask for a check in advance or wait for the cuts?
As of today, all we know about the Social Security check cuts is not official information. Economists say that the cut in the Administration’s check will be around 25% of the current money. This means that benefits will drop considerably. If today the maximum check is $4,555, in the future we will find ourselves with a benefit of less than $3,500.
This will be due to a lack of funds from the Social Security Administration. According to experts, these cuts will only be for new retirements. Therefore, the checks granted today will remain at the same amount, although that could also change.
Therefore, this has many Americans thinking about applying for Early Retirement Age before the year 2034 arrives. This is the year when Social Security is scheduled to run out of funds. Even so, check well that your decision is a wise one before doing anything rash.
Applying for Early Retirement Age
In order to apply for a Social Security check, you must be 62 years old, except in special cases due to disability. Applying for retirement at this age is known as Early Retirement Age. Applying for this check means losing 30% of the money we have contributed as a worker.
Therefore, it may not be a good idea to apply for retirement at this age. Unless we have contributed a very high benefit, something very unlikely if we have worked only until 62. The 30% reduction can mean the loss of up to $600 per month in the case of having contributed a check of $2,000 per month.
Applying for a check after the cuts
On the other hand, if we wait a little longer, the result may not be so bad in the end. Experts are talking about a reduction in checks awarded since 2034 of about 24%. This is less than the Early Retirement Age reduction, so if we apply for a Full Retirement Age at 67 we will have a larger check.
As we have commented before, the final decision is up to each citizen. Besides, everything will depend on the conditions under which the check is requested. Even so, if we want to be sure, the best thing to do is to contact an expert on the subject and get the best possible advice.