"Finding out what one's expected benefits are should be the first step in trying to put together a monthly budget for retirement. After all, social security payments can make up a significant percentage of most retirees' income in retirement, particularly for those who choose to stop working after they begin taking distributions. For investors who haven't built up a retirement portfolio at all, these payments will amount to the entirety of their monthly income."
"Social security benefits are based on the highest 35 years of indexed earnings. What this can mean is that seniors who choose to work past the age of 62 may increase their overall earnings, if their pay is higher than their lowest-earning years. Thus, many may want to think about choosing to stay in the workforce longer, not only to contribute to their retirement accounts, but also to increase their potential social security payouts as well."
Everyone in the U.S. becomes eligible for Social Security payments at age 65, with the option to apply and claim earlier or later. Delaying claims can increase monthly payouts while claiming early typically lowers them. Social Security payments can form a significant portion or the entirety of many retirees' monthly income. Benefits are calculated from the highest 35 years of indexed earnings, so working past age 62 can raise benefits by replacing low-earning years. Retirees with extra capital should decide whether to spend on vacations, family time, or philanthropy and incorporate expected benefits into a retirement budget.
Read at 24/7 Wall St.
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