In this article, I’m going to discuss the specifics of social security benefits for retirees.
When can I begin collecting social security benefits?
You can begin collecting benefits any time from age 62 – age 70. Each month you wait to start collecting – up until age 70 – increases your benefit amount. Your benefit amount increases 8% annually (2/3 of 1% monthly).
What is my full retirement age?
Social Security Full Retirement Age is the age at which you will receive your full benefit amount. Your full retirement age is based on the year you were born. The different Full Retirement Ages are as follows:
- Born in 1956: 66 + 4 months years old
- Born in 1957: 66 + 6 months years old
- Born in 1958: 66 + 8 months years old
- Born in 1959: 66 + 10 months years old
- Born in 1960 or later: 67 years old
When and how do I apply for Social Security?
You can apply for Social Security four months before you want to start receiving your benefits. If you’re applying for survivor benefits, you can apply as soon as you’re eligible.
An application can be submitted in the following ways:
- Online by completing the Social Security application on ssa.gov
- Over the phone by calling the Social Security Administration at (800)-772-1213
What if I apply for benefits and then change my mind?
You have up to 12 months to withdraw your Social Security benefit application. If you’ve already received benefits, you’ll be required to pay them back.
After you reach full retirement age, you can also suspend your benefits for a period before restarting them later for a higher benefit amount.
Can I work and collect benefits?
You can work and collect benefits. However, if you have not reached your full retirement age and begin collecting benefits, your benefits will be reduced/penalized for earnings above a variable annual threshold. The 2025 threshold is $23,400.
Will Social Security benefits still be there when I retire?
The solvency of the Social Security program is an ongoing topic of conversation. But if you’re already in retirement or approaching it, it’s not likely to affect you.
If you’re far off from retiring, make sure to track how changes to Social Security could affect your plan.
Do Social Security benefits keep up with inflation?
Yes, monthly social security payments keep up with the rise in cost of living every year. Each year the Social Security Administration evaluates inflation data and institutes a benefit increase called a cost-of-living adjustment (COLA). But if inflation hasn’t increased, then they may not institute a COLA.
How is Social Security taxed?
Federal taxes: Depending on your total modified adjusted gross income, you may have to pay taxes on social security. But, only up to a maximum of 85% of your Social Security benefits will be taxable, depending on your taxable income from other sources outside of Social Security.
State taxes: Taxation of social security benefits differs based on each state. Most states do not tax social security benefits. In 2025, there are 9 states remaining that tax social security to some degree. Each state’s rules differ based on income and whether you earn above a specific threshold.
When should I take benefits?
The right answer to this question differs for every person. Here are a few factors to consider:
- Life expectancy: If your life expectancy is shorter, consider taking benefits earlier. If your life expectancy is longer, consider delaying benefits.
- Other sources of retirement income: How do your other sources of income play into your retirement plan? Do you have pensions, IRAs, 401(k)s, and how do those affect social security? Remember, your children cannot “inherit” your social security benefits like they can with IRAs, 401(k)s, etc.
- Wages: Do you plan to continue working past age 62? If so, consider delaying benefits to avoid any Social Security benefit penalty.
- Social security benefit break evens: Compare the cumulative lifetime benefit breakeven of taking social security at earlier ages vs delaying until later ages. For example, comparing age 62 vs age 67… if you delay until age 67, at what age do you break even (from a cumulative benefits standpoint) for the benefits you gave up from 62 – 67?
- Spending desires and legacy: Do you want to spend more in earlier retirement years or spend more in later retirement years? What are your legacy goals for leaving assets to loves ones?
All these factors should be discussed further and analyzed based on your specific situation.
This is a high-level overview of Social Security benefits, and the common questions associated. I typically recommend planning for your social security strategy 5 years ahead of your retirement date. If this applies to you, it is important to make sure you understand all aspects of your Social Security benefits and evaluate your options.
For more information visit: https://www.ssa.gov/
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