How Long Does It Take To Get Approved For Social Security
Its important that you plan for when you want your benefits to start. They are not turned on like a water faucet. If youre claiming Social Security retirement benefits, plan on at least six weeks for your application to be processed. However, if your application has incorrect information or the agency is backlogged, it could take up to three months before benefits begin, warns AARP. However, you cannot apply for benefits more than four months before you want them to begin, according to the Social Security Administration.
So its a good idea to start the application at least three months before you want your benefits to start. Otherwise, you may end up with a deficit in your finances during the transition period.
How To File An Application For Social Security Retirement Benefits
- In person: You will need an appointment in order to apply in person for your Social Security benefits. You will need to find and contact your local SSA office to make an appointment. Call to find the local office.
- Online: You can apply for Social Security benefits online anytime you choose 24 hours a day/7 days a week. This is, in fact, the easiest way to do so, but be aware that you may not be able to apply for all your benefits online. You might, however, need to complete the application either in-person or on the phone. The online system will tell you how to proceed.
How Do I Qualify For Social Security
To qualify for Social Security retirement benefits, in most cases:
- You must be 62+ years old, or disabled/unable to work, and
- You must have sufficient credits earned throughout your working life.3
To qualify for Social Security spousal retirement benefits:
- You must be married to a retired worker , and
- You must have a child under age 16 or a disabled child in your care, or
- You are 62+ years old.2
To qualify for Social Security disability benefits if you are under the age of 62:
- You must be 18+ years old and unable to work due to physical or mental disability, and
- Your condition is expected to last at least a year or may result in death.3
You still can qualify for Social Security disability benefits without earning the required 40 credits, depending on the circumstances. Your lifetime earnings and benefits help determine your monthly disability benefit amount.
To qualify for Social Security survivors benefits:
- You must be a widow or widower who is 60+ years old , or
- You must be a widow or widower caring for the deceaseds child who is under the age of 16 or disabled, or
- You must be a surviving divorced spouse , or
- A dependent parent who is 62+ years old, or
- You must be an unmarried child of the deceased and are:Under 18 years old , or
- 18+ years old with a disability that occurred before you turned 22.3
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Watch Out For Hidden Costs
Youll also want to consider other lifestyle factors, especially Medicare. Americans become eligible for federal health insurance coverage at age 65, well after when you can begin to file for Social Security.
If you stop working at age 62 and lose health insurance, you have to get supplemental insurance to bridge the gap until you turn 65 and Medicare kicks in, Neiser says.
If you work during retirement, you have another incentive to delay collecting Social Security. Earning too much at a job after you begin collecting your benefit can reduce your payout, but only if you have yet to hit full retirement age.
However, when you hit full retirement age, your benefit will increase to account for any benefit that was withheld earlier due to working. Heres how much you can earn and not get hit.
If youre younger than full retirement age for all of 2021, the Social Security Administration will deduct $1 of your monthly check for every $2 you earn above $18,960 per year.
If you reach full retirement age in 2021, the administration deducts $1 of your monthly check for every $3 you earn above $50,520 until the month you reach retirement age.
Youll also owe Social Security and Medicare tax on your earnings, even if youre already receiving benefits.
So those are some potential pitfalls to claiming Social Security early.
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If You Work While Getting Social Security
Yes, you can work full or part-time while also getting Social Security retirement benefits. However, if you have not yet reached your full retirement age, and if your net income from working is higher than the annual earnings limit, your annual benefits will be reduced. Beginning in the month you reach full retirement age, Social Security will stop reducing your benefits no matter how much you earn.
During any full calendar year in which you are under full retirement age, Social Security deducts $1 from your benefit payments for every $2 you earn above the annual net income limit. The income limit changes every year. In 2017, the income limit was $16,920.
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What Happens When You Withdraw Your Application
There are a few things to know before deciding to withdraw your application.
- Anyone else who receives benefits based on your application must consent in writing to the withdrawal.
- You must repay all the benefits you and your family received from your retirement application. This includes:
- Benefits your spouse or children received, whether they live with you or not.
- Money withheld from your Social Security retirement checks for:
- If you are already entitled to Medicare, you may choose to also withdraw your Medicare coverage.
If you are also entitled to railroad or veterans benefits, you should check with the Railroad Retirement Board and the Department of Veterans Affairs about how your withdrawal affects those benefits. The RRB and the VA make their own determinations and are responsible for their own programs.
Tax Considerations For Social Security Benefits
How do these tax considerations affect when you should apply for Social Security benefits? At todays , they may not have much of an impact on most people. Still, tax rates and income thresholds can change, so its worth remembering that you will lose less of your Social Security to taxes if you are in a lower marginal tax bracket when you begin to collect.
You should also note that if you decide to return to work, even part-time, and arent yet at your FRA, your Social Security benefits may be temporarily reduced. The reduction is $1 for every $2 of earned income over $18,960 in 2021 . During the year when you reach your FRA, your benefits will be reduced by $1 for every $3 in income over $50,520 in 2021 until the month when you become fully eligible. That money isnt lost, however. The SSA will credit it to your record when you reach your FRA, resulting in a higher benefit.
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What About Taxes On Social Security
Keep in mind that Social Security benefits may be taxable, depending on your combined income. Your combined income is equal to your adjusted gross income , plus non-taxable interest payments , plus half of your Social Security benefit.
As your combined income increases above a certain threshold , more of your benefit is subject to income tax, up to a maximum of 85%. For help, talk with a CPA or tax professional.
In any case, if youre still working, you may want to postpone Social Security either until you reach your full retirement age or until your earned income is less than the annual limit. In no situation should you postpone benefits past age 70.
How To Apply For Disability Benefits
As soon as you become disabled, the Social Security office asks you to apply either in-person, over the phone or via the website. Disability claims take longer to process than others, typically from three to five months. Providing relevant documentation such as medical information at the time you apply for Social Security disability can make the process move more rapidly.
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Can I Work And Collect Social Security
You are permitted to work while receiving Social Security retirement or survivors benefits. There is a cap on how much you may make and still be eligible for all benefits, however. We reserve the right to lower your benefit amount if you are under full retirement age and earn more than the annual earning cap.
What To Consider When Deciding The Best Age For Social Security Benefits
Youll receive reduced monthly benefits permanently if you start taking them before you reach full retirement age. And the reductions arent small. This breakdown summarizes how much you can lose depending on when you get your retirement benefits:
- Benefits are reduced by 30% if you opt to start receiving benefits just five years early.
- If you wait until you full retirement age youll receive 100% of your benefits.
- You can also elect to postpone benefits beyond full retirement age, up until you are 70.
- The monthly amount you will receive in the future increases each month you wait to start receiving benefits.
- If you can wait until the last possible month, your check will be 132% of the full retirement benefit.
For a fuller comparison, this table from the Social Security Administration shows how much you could get if you retire at age 62 based on your birth year:
|Social Security Administration Early Retirement at Age 62|
So, its almost always best to delay Social Security benefits for as long as you can. If you plan to work in retirement, youll definitely want to delay. Youll face a penalty if you continue to work after you claim early retirement benefits and earn more than the yearly earnings limit, which for 2020 is $18,960. This means that the Social Security Administration will deduct $1 from benefits for every $2 that you earned over $18,960.
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Doing A Breakeven Analysis And Other Ways To Decide How Soon To Start
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If youre about to retire, you may be wondering whether you should start claiming your hard-earned Social Security benefits now. Here are a few key factors to consider in making that decision.
Social Security Facts And Statistics
Numbers tell much of the story and show the importance of Social Security to Americas seniors. Nearly every American is eligible to receive benefits under the retirement program, which is not means tested. This means there are no minimum or maximum income requirements to receive benefits.
The program is crucial in the lives of retirees. But it has its own limitations and will require some kind of legal fix in the coming years.
Data from the Social Security Administration and the Center on Budget and Policy Priorities show:
For context, the second most important source of income for seniors is income earned from working, which accounts for 29 percent. This is followed by private and public pensions, at 17 percent, followed by 401s and IRAs at less than 3 percent of seniors total income, according to the Economic Policy Institute.
Those pension and savings percentages are likely to change as workers with jobs that dont provide private pensions fill the ranks of retirees, replacing those who had that benefit.
Looking for guaranteed income in retirement?
Social Security Benefits For Surviving Spouses
If your spouse was receiving Social Security benefits upon their death, you must report the death as soon as possible. You can call the Social Security Administration at 1-800-772-1213 between 7 a.m. and 7 p.m. on weekdays or visit your local Social Security office in person.
You are eligible for a one-time, lump-sum death benefit of $255 from Social Security if:
- You were receiving benefits on your spouses record at the time of death, or
- If you were living in the same household as your spouse at the time of death.
Any benefits received in the name of your spouse during the month of death or later must be returned to the Social Security Administration as soon as possible.
If your spouse worked long enough under Social Security, you may be eligible for Social Security benefits. You must be age 60 or older or disabled and 50 or older to qualify.
How much youll receive depends on the percentage of your spouses benefit as well as your age and the type of benefit youre eligible for.
You must apply for survivor benefits in person. You can call Social Security at 1-800-772-1213 to request an appointment.
Calculate Your Life Expectancy
Working While Receiving Social Security
You dont have to physically retire in order to be eligible for Social Security retirement benefits. Even if youre still working, you can file for and receive Social Security. However, if you file before your full retirement age, your benefits will be reduced by $1 for every $2 in income that you earn from your job, above a certain limit $17,640 for 2019. In the year you reach full retirement age, the reduction is $1 for every $3 in income you earn. Once you cross full retirement age, there is no reduction in your benefits.
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The good news is youre not actually losing those benefits. Theyre simply not paid out to you while youre working. You can receive them after full retirement age, when the Social Security Administration will increase your monthly benefit to compensate.
One of the downsides of working while receiving Social Security is that a portion of your benefits may be taxable. The amount thats taxable and the earnings thresholds for tax year 2019 are as follows:
- For single filers earning between $25,000 and $34,000: Up to 50% of benefits are taxable.
- For single filers earning over $34,000: Up to 85% of benefits are taxable.
- For joint filers earning between $32,000 and $44,000: Up to 50% of benefits are taxable.
- For joint filers earning over $44,000: Up to 85% of benefits are taxable.
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Factors That Affect Social Security Benefits
The math seems to say that everyone should wait until age 70 to reap the best benefits, but this isnt always the case. There are times when it might make sense to start collecting earlier. If, for example, you are in poor health or if the family breadwinner is ill and can no longer work, collecting before your full retirement age could help prevent debt from mounting up.
Your marital status also plays a factor. If youre single and in poor health, you could end up using your savings to pay for medical bills between the ages of 66 and 70. In this case, you might be better off collecting Social Security benefits at a lower rate than holding out for the higher payments youd receive at age 70.
If, however, youre single, in good health and either still working or have plenty of savings, consider waiting until age 70 in order to benefit from the higher payments.
With married couples, it could be best for the spouse who earns the most money to hold off until 70, while the spouse who makes less starts collecting at 62. This approach will ensure that when one of you passes away, the surviving spouse will receive the higher benefitsgenerally the amount their spouse would have received at age 70, even if the spouse died before that age.
For more help with retirement planning, consider contacting a Certified Financial Planner. They can help you ensure youre maximizing your Social Security benefits and answer any questions you have about your other assets.
How To Apply For Social Security Retirement Benefits In 3 Simple Steps
You can apply for Social Security benefits as soon as you reach 61 years and 9 months of age. To qualify for Social Security retirement benefits, you need to earn 40 credits. As of 2019, you earn one credit for every $1,360 you earn, up to four credits per year.
The process of applying for Social Security benefits is simple and can be completed in just three general steps:
You can get your Social Security application status via the same method you used to apply.
Heres a deeper dive into each of the three steps for applying for retirement benefits from the SSA:
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How Do I Apply In Person
Please keep in mind, due to Covid-19, face-to-face service may be suspended. Confirm Social Security offices are accepting in-person appointments.
Once you have an appointment, prepare all the required documents. I would suggest going above and beyond to avoid having to make multiple trips.
During the appointment, you and the Social Security officer will go through the application process, discuss the questions, and look at the documents you provide.
If you have any questions and concerns, make sure to write them down prior to the appointment and ask the officer while you speak with them.