2011-01-06 / Local & State

How To Maximize Your Social Security Benefits

Thinking of retiring? After a lifetime of hard work and income tax, you probably want to get the most out of your social security dollars.

Fortunately, social security is flexible enough to accommodate different circumstances. And knowing your different options is the first step to finding what plan will work best for you and your family.

What To Consider

The first step you’ll need to take in order to make an informed decision is to find out how much money you’ll receive in a couple of different scenarios. Your benefits will vary not only according to your age and salary, but also depending on whether you start collecting early, collect while working, receive spousal payments, or suspend your payments until you’re 70.

You also want to consider your overall health and other retirement or pension plans you have. To learn about the different options available to you, visit the Social Security Administration (SSA) at www.socialsecurity.gov and use the online calculator.

Collecting Early Tactics

While the full retirement age for most Americans is 67, most are eligible to start collecting early at age 62. And while you can continue working while collecting, your benefits may be reduced by up to 30 percent.

Some of your benefits can be withheld if you have extra earnings, but after you reach the full retirement age, the SSA will recalculate your benefit amount to give you credit for any months for which you did not receive benefits. In this tough economy, collecting early may be a desirable option for seniors unable to find work but still able and willing to work in the future.

Double Team Delay

If both you and your spouse are at full retirement age, you can choose to collect benefits off your spouse’s account (usually around 50 percent of his or her monthly payment) while letting your account accrue additional benefits. Benefits can be accrued until age 70, increasing your eventual payments by 6 to 8 percent a year.

Regardless of whether you do decide to delay your benefits or collect, it’s important you sign up for Medicare at age 65. Not doing so can cause your Medicare coverage to be delayed or cost more when you do need it.

Obviously, there’s no onesize fits-all solution to maximizing your social security benefits, so consult a financial advisor or speak to an SSA representative by calling 1- 800- 772- 1213 or visiting www.socialsecurity.gov.

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