Social Security: 4 Facts to Know

Waiting until you get closer to retirement before you figure out Social Security's rules and requirements? That might work but putting it off could have an adverse impact on your future. Instead, make sure you understand the basics and start planning:

• Do I qualify?
• What is my official "full retirement age?"
• What happens if I retire earlier—or later?
• How could my spouse's benefits impact mine?

Get the facts now to make retirement easier down the road.

1. Social Security Is Not a Given

You have to work (enough) to qualify for benefits. Once you earn it, your family can also receive benefits based on your earnings. Learn more at www.ssa.gov .

* 2019 wages/self-employment income. Source: How You Earn Credits, 2019, www.ssa.gov 

2. Full Retirement Age Doesn't Mean 65

Your Full Retirement Age (FRA) depends on when you were born.

Source: Social Security Administration (www.ssa.gov ) as of March 2019.

3. Drawing Social Security Early May Not be the Best

You can start before your Full Retirement Age, but delaying your benefits lets you collect more.¹

Below are the percentages of the total benefit amount you will collect by age:

¹ Increased benefits for delaying Social Security max out at age 70.
Source: www.ssa.gov  as of March 2019.

4. Spouses Can Take a Team Approach to Maximize Benefits

An individual earner can extend benefits to his or her spouse—to add to his or her own earned benefits, or to use alone. How much each spouse earned and their anticipated life expectancy helps determine how and when to take Social Security.

Spousal Benefits Can Boost Your Bottom Line

Sam's Benefit Amount = $2400 | Kathy's Benefit Amount = $700

² Surviving spouse benefits are similar to spousal benefits except they will receive the higher of their own benefit or their deceased spouse's benefit. The surviving spouse must be at least 60 years old and the couple must have been married for at least nine months prior to the non-surviving spouse's death (with exception for accidents).

Source: American Century Investments, www.ssa.gov .

The Bottom Line

Taking Social Security at age 62 might not be the best choice. Evaluate your options and make Social Security a part of your overall retirement planning strategy. Knowing when—and how—to claim benefits can give you a better chance of making your retirement money last.