Retirement Income Tips: Social Security & Taxes
Social Security Overview
The most common question we hear about Social Security is, “I know I can’t outlive my Social Security benefit, but will Social Security provide me with enough income when I stop working?”
Here’s a fact that may surprise (and possibly scare) you: Social Security may replace up to 57% of lower income workers’ income; however, it may replace only 27% for higher income workers – less than one-third of their income! Ouch!
Assuming You've Paid into the Social Security Program Throughout Your Working Life, Here Are Some More Helpful Facts:
- You cannot outlive your Social Security income, no matter how long you live.
- You will receive COLA (Cost-of-Living Adjustments) automatically as Congress authorizes such adjustments.
- You don’t have to be knowledgeable about investments or make frequent financial decisions; everything happens pretty much automatically.
Keys to Optimizing Social Security Benefits:
- How much income will you need in retirement?
- How Social Security benefits are calculated ... and simple ways to increase them.
- Learn how to increase your income through the “File and Suspend” strategy.
- How will working in retirement effect your Social Security benefits.
- Find out how to receive benefits from an ex-spouse.
- Learn the ways the government can tax your Social Security benefits.
Social Security Has Another Important Abbreviation "FRA" That Stands for Full Retirement Age
If you were born, for example, between 1943 and 1954, your FRA is 66 years and 0 months. So, if you “retire” sooner than your FRA and start drawing your Social Security benefits, you will receive LESS money than if you had waited until you reached your FRA. Conversely, if you “retire” later than your FRA, you will receive MORE money.
