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Social Security Frequently Asked Questions Thumbnail

Social Security Frequently Asked Questions

What happens to my social security benefit if I retire early before I reach my full retirement age according to the Social Security Administration?

Your social security is based on your best 35 years of employment and those earnings.  The Social Security statement you receive annually assumes that you will work until your Full Retirement Age “FRA”.  Your FRA is based on the year you are born.  If you were born after 1960, your FRA is age 67.  Retiring earlier than your FRA could result in your benefits being lower that what is reflected on your benefit statement.  

If I retire early before my FRA, how can I get a better estimate of the impact that will have on my social security benefit?

You can get a more accurate estimate by using the Retirement Estimator on the Social Security Administration’s website at www.ssa.gov.

Can I continue to work and collect social security after I reach my FRA?

Social security will automatically recalculate your benefits each year you continue to work.  If your income is greater than one of your previous 35 years of earnings, your benefit will be recalculated and adjusted upward.  Social Security will generally make adjustments in October of the following year, but the increase will be retroactive to January 1.

How far in advance should I apply for my benefit?

You should start to apply 4 months before you want your benefit to commence.  If you are late in applying for your benefits, social security will retroactively pay you for the months missed.  For example, if you turn 70 in June and do not apply for your benefits until September, Social Security will backpay you for the three months after you turned 70.

Will my social security be taxed?

Generally, yes.  The taxability of your benefit is based on your income.  The range of your benefit that is taxable can vary from 0% to 85%.  

Do I still have to pay social security taxes if I am collecting benefits and working?

Yes, if you are working, regardless of your age, or benefit eligibility, you must pay social security taxes, also known as FICA.   There are a few exceptions, such as a person who qualifies for a religious exemption.  

Is it wise to defer claiming social security past your FRA until age 70?

For every year you delay your claim past your FRA, you get an 8% increase in your benefit. That could be at least a 24% higher monthly benefit if you delay claiming until age 70. Deciding to defer your benefit will depend on your personal circumstances such as your health and what additional sources of income you may be receiving to bridge the gap.

Does my spousal benefit increase if my husband or wife does not start collecting social security until age 70?

No, the 50% spousal benefit is based on the husband or wife’s benefit at their FRA and the spousal benefit does not receive an incremental increase.  

Should I wait past 70 to collect my social security benefits?  

Waiting beyond age 70 will not increase your benefits, nor will you receive any additional benefit increases if you continue to delay claiming your social security. Always claim your benefit at age 70.

My spouse is younger, can I collect on their benefits?

You will need to wait until your spouse files for their social security benefit.  If 50% of their spousal benefit is more than 100% of your own benefit, social security will pay you the higher amount.  

Can I file for a restricted spousal benefit and then later switch to my own benefit at age 70?

You can only collect spousal benefits and wait until 70 to claim your retirement benefit if both of the following are true: You were born before Jan. 2, 1954 and your spouse is collecting his or her own Social Security retirement benefit. 

Can I collect benefits on a deceased ex-spouse?

Waiting to collect benefits until full retirement age will qualify you to receive 100% of what your deceased ex was receiving when they passed away. If they were not collecting benefits at the time of death, you will receive 100% of what they were entitled to receive. If you collect before your full retirement age, you may still collect survivor benefits from your late ex-spouse, however, the amount you receive will be reduced.

What if I have been divorced twice, can I collect spousal benefits on both ex-spouses work histories?

No, you can only collect on one record, but social security will pay the highest benefit based on which ex-spouse’s record would provide a more beneficial payment.  

How long did I need to be married to collect benefits on an ex-spouses benefit record?

You must be married 10 Years and you cannot re-marry before age 60.

If I retire at 62 and still have kids under 18, can my children collect family benefits?

There is a little-known loophole in the social security system for parents that are age 62 or older with children still in high school or younger. If you are age 62 or older and you have children under that age of 18,  they can collect a social security benefit based on your earnings history equal to half of the parents’ social security benefit at normal retirement age. This amount could equal as much as $16,122 per year for one child for higher income earners. If you have multiple children, the total annual amount paid to your family members could equal between 150% to 180% of your normal retirement benefit which could be in excess of $40,000 per year depending on your earnings history.

What benefits will my family receive if my spouse dies?  

Social security will pay survivors benefits on the base amount of the earnings of the spouse that has died. The more they paid into Social Security, the higher your benefits would be. If you have children under the age of 18, (age 19 if still in elementary or secondary school) the children will receive 75% of the primary insurance amount.  The surviving Widow or widower, any age, caring for a child under age 16  will receive 75% of the primary insurance amount. There's a limit to the amount that family members can receive each month, it is generally equal to between 150% and 180% of the basic benefit rate.

Important Acronyms

Full Retirement Age (FRA):The age at which you are entitled to receive your full social security benefit.  The age varies between age 65 and age 67 depending on the year you were born.  https://www.ssa.gov/benefits/retirement/planner/agereduction.html

Primary Insurance Amount (PIA): The full monthly social security benefit you will be entitled to receive at FRA.  All benefits are based on your earnings record (including spousal and survivor benefits).