Social Security

Social Security is part of the retirement plan for almost every American worker. It provides replacement income for qualified retirees and their families. Social Security replaces a percentage of your pre-retirement income based on your lifetime earnings. The portion of your pre-retirement wages that Social Security replaces is based on your highest 35 years of earnings and varies depending on how much you earn when you choose to start benefits. When you work, you pay taxes into Social Security. The government uses that tax money to pay benefits to:

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• People who have already retired

• People who are disabled

• Survivors of workers who have died

• Dependents of beneficiaries

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The money you pay in taxes isn't held in a personal account for you to use when you get benefits. The government uses your taxes to pay people who are getting benefits right now. Any unused money goes to the Social Security trust fund that pays monthly benefits to you and your family when you start receiving retirement benefits.

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Planning is the key to creating your best retirement. You'll need to plan and save for years to achieve your retirement goals. While many factors affect retirement planning, we want you to understand what Social Security can mean to you and your family's financial future.

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On average, retirement beneficiaries receive 50% of their pre-retirement income from Social Security. As you make your retirement plan, knowing the approximate amount you will receive in Social Security benefits can help you determine how much other retirement income you'll need to reach your goals.

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When you work and pay Social Security taxes, you earn "credits" toward Social Security benefits. The number of credits you need to get retirement benefits depends on when you were born. If you were born in 1929 or later, you need 40 credits (usually, this is 10 years of work).  If you stop working before you have enough credits to qualify for benefits, the credits remain on your Social Security record. If you return to work later, more credits may be added. The government can't pay any retirement benefits until you have 40 credits.

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The amount of the Social Security benefits you or your family receives depends on the amount of earnings shown on your record. Regularly checking your Social Security earnings history can help ensure there are no surprises when it's time for you to start receiving benefits. Knowing what you will get every month in your retirement benefits will help you plan for your retirement.

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Choosing when to start receiving retirement benefits is a personal decision. If you choose to retire and begin receiving benefits when you reach your full retirement age, you'll receive your full benefit amount. The government will reduce your benefit amount if you decide to start benefits before reaching full retirement age. To make an informed choice, consider the following factors as you think about when to start your Social Security benefits: full, early or delayed retirement age.

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​What Age Should You Start Receiving Benefits?

The age you begin receiving your retirement benefit affects how much your monthly benefits will be. There are three important things to know about age when thinking about when to start your benefits:

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• Full Retirement Age: Full retirement age when you can start receiving your full retirement benefit amount is 66 if you were born from 1943 to 1954. The full retirement age increases gradually if you were born from 1955 to 1960, until it reaches 67. For anyone born 1960 or later, full retirement benefits are payable at age 67.

• Early Retirement Age: You can get Social Security retirement benefits as early as age 62. However, the government will reduce your benefit if you start receiving benefits before your full retirement age.

• Delayed Retirement Age: When you delay benefits beyond your full retirement age, the amount of your retirement benefit will continue to increase up until age 70. There is no incentive to delay claiming after age 70.

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Everyone's retirement is unique. Beyond deciding when to begin receiving retirement benefits, other factors that can affect your benefits include whether you continue to work, what type of job you had, and if you had a pension from certain jobs.

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You can choose to keep working beyond your full retirement age. If you do, you can increase your future Social Security benefits. Each extra year you work adds another year of earnings to your Social Security record. Higher lifetime earnings can mean higher benefits when you choose to receive benefits. While Social Security earnings are calculated the same way for most American workers, there are some types of earnings that have additional rules, including:

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• Farm Work

• Federal Government Employment

• Household Employment

• Military Service

• Nonprofit or Religious Organizations

• Railroad Earnings

• Self-Employment

• State and Local Government Employment Wages

• Work outside the United States

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Pension and taxes have the potential to impact your retirement benefits as well.

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How to Apply

Starting your Social Security retirement benefit is a major step on your retirement journey. Before you apply, take time to review the basics, understand the process, and gather the documents you'll need to complete an application. You can start your retirement benefits as early as age 62 or as late as age 70. If you're preparing to apply for retirement benefits, knowing when you're eligible to apply and how the system works are the first steps in choosing what age is right for you. Before you apply, you should understand:

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• How you qualify for Social Security benefits

• How your earnings and age can affect your benefits

• What you should consider in deciding when to start receiving benefits

• Retirement benefits for spouses and family members

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The retirement benefits application process follows these general steps, whether you apply online, by phone, or in person:

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• Gather the information and documents you need to apply

• Complete and submit your application

• The government reviews your application and contacts you if they need more information

• The government will mail you a decision letter

• You start receiving your retirement benefits

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You must be at least age 62 for the entire month to be eligible to receive benefits. If you were born on the first or second day of the month, you meet this requirement in the month of your 62nd birthday. If you were born on any other day of the month, you do not meet this requirement until the following month.

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You can apply up to four months before you want your retirement benefits to start. For example, if you turn 62 on December 2nd, you can start your benefits as early as December. If you want your benefits to start in December, you can apply in August. If you turn 62 any day after December 2, you are not age 62 for the entire month of December. You can start your benefits as early as January when you are 62 for the entire month. If you want your benefits to start in January, you can apply in September.

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Social Security benefits are paid in the month following the month they are due. If you are due benefits for the month of December, you will receive your first check in January for December.  You may be able to receive retirement benefits on your spouse or former spouse's record. Likewise, your spouse or family member may be able to receive benefits on your record if they qualify. Before applying, be ready to provide your Social Security number and information about:

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• Dates of current and previous marriages, and where you were married

• U.S. military service dates and branches

• Employer names and dates for the past two years

• Self-employment income and type of business

• Bank information to setup your direct deposit

• Information on family members who may be eligible to receive benefits on your record

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The government will ask for certain documents they need to review and process your application. These documents may include:

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• Your original birth certificate or other proof of your age. This must be the original document or a certified copy from the issuing agency. 

• Proof of U.S. citizenship if you were not born in the U.S. and have not submitted proof for an earlier Medicare or Social Security claim. The government must see the original document(s) or copies certified by the agency that issued them. The government cannot accept expired, notarized, or photocopied documents.

• A copy of your W-2 tax form(s) and/or self-employment tax return from last year. A photocopy is acceptable.

• A copy of your U.S. military service papers if you served before 1968. A photocopy is acceptable.

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You can apply online, by phone or in person. Instructions on how to submit your documents will appear at the end of the online application. If applying by phone, gather the information above. The government will walk you through the process on the phone. If applying in person, ask your local Social Security office what you need to bring when you call to schedule your appointment They can help you if you don't have all your documents right now.

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Follow these steps to apply online:

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• To start your application, go to the government's Apply for Benefits page at https://www.ssa.gov, read and agree to the Terms of Services, Click "Next"

• On that page, review the "Getting Ready" section to make sure you have the information you need to apply

• Select "Start a New Application"

• The government will ask a few questions about who is filling out the application

• You will then sign into your Social Security account or be prompted to create one

• Complete the application

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You may help someone else fill out their application, but you are not allowed to sign it for them. Only the person applying for benefits can legally sign the application. If they are not able to sign online, the government will mail them a copy to sign.

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You can do most of your business with Social Security online. If you cannot use these online services, your local Social Security office can help you apply. You can also find the phone number for your local office by calling 1.800.772.1213, 8am - 7pm, Monday - Friday.

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Once you've applied and the government has received your application, they will review it and contact you if they have any questions. The government might request additional documents from you before they can process the application. 

 

You'll receive a letter in the mail with the government's final decision. If you included information about other family members when you applied, they will let you know if they may be able to receive benefits from your application. You can check the status by calling the same number previously listed.

 

You have the right to appeal any decision the government makes about whether you're entitled to benefits. You must request an appeal in writing within 60 days of receiving their decision. There are four levels of appeal:

 

• Reconsideration by Social Security Staff

•  A hearing before an administrative law judge

• A review by Social Security's Appeals Council

• A review by the federal courts

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Sometimes, life changes occur after you submit your application. You have up to 12 months to withdraw your application if you change your mind. You will be required to repay any benefits you've already received.

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