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social security benefits cut

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Social Security Benefits Cut

Alot of seniors are not aware if they retire early their social security benefits can be cut drastically. A typical social security retiree can start taking benefits as early as age 62, but your income will be substantially higher if you are willing to wait. Don’t let your social security benefits get cut!

Here’s an example:

Senior 1 retires at age 62 will earn $1,135 dollars a month

Senior 2 retires at age 66 will earn $ 1,500 dollars a month

And if you wait to retire at age 70 you might be able to claim as much as $ 1,980 dollars a month!

In a short sweet wrap up claiming social security at age 62 means you’ll receive lower benefits compared with waiting until full retirement age.  So the moral of the story is, if you can afford to wait then wait!

Here’s more from Phillip Moeller at Time Money about how social security benefits cut:

The figures below show how Social Security calculated average retirement benefits as of the end of 2012 for four categories of worker pay: minimum wage, 75% of the average wage, average wage, and 150% of the average wage. (The agency pulls average wages each year from W-2 tax forms and uses this information in the indexing process that helps determine benefits.)

  • Worker at minimum wage: The monthly benefit at 62 is $686 and, at age 66 is $915.50. The maximum monthly family benefits based on this worker’s earnings record (including spousal and other auxiliary benefits) is $1,396.50.
  • Worker at 75% of average wage: The monthly benefit at 62 is $975 and, at age 66 is $1,300.40. The maximum monthly family benefits based on this worker’s earnings record (including spousal and other auxiliary benefits) is $2,381.20.
  • Worker at average wage: The monthly benefit at 62 is $1,187 and, at age 66 is $1,583.20. The maximum monthly family benefits based on this worker’s earnings record (including spousal and other auxiliary benefits) is $2,927.40.
  • Worker at 150% of average wage: The monthly benefit at 62 is $1,535 and, at age 66 is $2,047. The maximum monthly family benefits based on this worker’s earnings record (including spousal and other auxiliary benefits) is $3.582.80.

In short, claiming at age 62 means you’ll receive lower benefits compared with waiting till full retirement age. But given a lifetime earnings history and Social Security’s wage indexing, receiving a lower wage for your last few working years will not make a big difference to your retirement income.

http://time.com/money/3525330/social-security-retire-early-benefits-cut/

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