5 social security tips for 2019 – and beyond

Even if you do not retire in 2019, it still helps to read up on Social Security and learn what to expect from the program. Here are some important tips that will help you get the most out of your benefits.

1. Know your full retirement age

Your social security benefits are calculated from your earnings during the 35 highest paid years on the job. You are then eligible to receive the full benefits when you reach full retirement age. That age is not the same for everyone; it varies based on your year of birth, as follows:

DATA SOURCE: SOCIAL SECURITY ADMINISTRATION .

Although you are allowed to claim social security as early as the age of 62 and as late as 70, it is important to remember the above age for your filing decision.

PICTURE SOURCE: GETTY IMAGES.

2. Review the Income Protocol Annually

Each year, the Social Security Administration (SSA) issues you with an income statement. If you are 60 years or older, you will receive it in the mail, and if not, you can access it on the SSA website. It is important to review this document annually for two reasons. First, because it provides an estimate of what your benefits will look like when you reach full retirement age. The closer you are to retirement, the more accurate the estimate will be.

Secondly, there is a chance that your income statement may contain an error about your income that works against you. For example, the one-year statement may show that you only made $ 40,000 when you actually made $ 80,000. Correcting such errors is crucial because the ones mentioned earlier are your Social Security benefits based on your income history, and such a mistake can cause your benefits to fall unnecessarily.

3. Understanding the Disadvantages of Filing Early

SSA will allow you to start claiming benefits at the age of 62. However, for each month you submit before full retirement age, your benefits will be reduced. If you register for 62 years with a full retirement age of 66, you lose 25% of the benefits. Do it when the full retirement age is 67 and you are looking at a 30% reduction. Furthermore, any reduction you face will be in effect permanently unless you can withdraw your benefit claim within a year and also repay the SSA every penny it paid you, which is easier said than done.

4. Recognizing the benefits of filing as late as possible

Just as demanding social security early will result in a reduction in benefits, delaying filing after full retirement will increase. For every year you claim social security beyond that point, you will accrue delayed retirement credits that increase your benefits by 8% a year until you reach 70. Remember that while SSA will not force you to claim benefits of 70, there is no financial incentive to wait past that point. In fact, if you file for too long, you risk losing money that could be yours.

5. Realize that your health should play into your registration decision

There are many factors that are likely to affect your decision on when to claim benefits, such as the degree to which you need the money and whether you are still working. But an important driver of the decision should be your health. If it is bad, it is generally better to claim benefits at the beginning, because while doing so you will reduce your social security income on a monthly basis, and you are likely to arrive at a lifetime. When it comes to health care, it usually pays to postpone benefits as long as possible, as doing so will give the highest life expectancy.

Suppose you are entitled to $ 1500 a month in Social Security at full retirement age 67. Filing at age 62 reduces each monthly payment you collect to $ 1,050, but you will get 60 more payments to break evenly around age 78 1/2. But if you don't live before 78 1/2, you will get ahead by filing early. And if you delay the benefits to 70 years in this scenario, you will break even at 82 1/2. Therefore, if you live longer than that, you will benefit from having filed.

The more you know about social security, the better these benefits will benefit you in retirement. Remember these points as you read the program and get ready to make a decision that will impact your golden years, for better or worse.