Navigating the Complexities of Social Security Benefits

August 16, 2017 James Heinsman Economic Barometer

As people approach retirement age, they naturally need to become familiar with what are the most beneficial practices regarding Social Security payments. Financial advisory companies such as Connecticut-based Essex Financial, are good sources of help when navigating the particulars of this universal entitlement.

Everyone born after 1929 is entitled to Social Security benefits if they have worked for at least ten years in order to earn the mandatory 40 credits. But even if you have already earned 40 credits, the money cannot be paid until the recipient reaches the minimum age of 62. Every year, three months before a person’s birthday, the Social Security Administration mails a summary of every person’s benefits. The yearly statement includes a history of earnings, accumulated credits and an estimate of the benefits a person will be entitled to if he/she waits until full retirement age. Always check the statement is accurate, since your benefits are determined by lifetime earnings.

Until 1983 “full retirement age” was 65, but that year Congress voted to raise the age of full retirement to 67 for people born in 1960 or later. For someone born between 1938 and 1960, the full retirement age varies.

A new study done by the Boston College’s Center for Retirement Research showed that about 42 percent of men and 48 percent of women still take their benefits at age 62 with the average age being 64.

It is understood by most that the earlier a retiree begins to collect his/her benefits, the lower those monthly payments will be. What is not well understood is how large that difference is. For instance, if someone’s full retirement age is 66, if he begins to collect at age 62 ½, he nets a 25 percent lifetime benefit reduction, while waiting until age 70 will give him a 32 percent credit.

CEO Chuck Cumello of Essex Financial Services, along with many other financial services firms, are there to help clients navigate the complicated details of Social Security benefits, as well as other financial issues.

Chuck Cumello, Connecticut, Essex Financial, Essex Financial Services, Social Security,

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