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What Are The Benefits Of Social Security

How Do Benefits Work And How Can I Qualify

How to Apply for Social Security Benefits

While you work, you pay Social Security taxes. This tax money goes into a trust fund that pays benefits to:

  • Those who are currently retired

  • People with disabilities

  • The surviving spouses and children of workers who have died

Each year you work, youll get credits to help you become eligible for benefits when its time for you to retire. Find all the benefits the Social Security Administration offers.

There are four main types of benefits that the SSA offers:

  • Learn about earning limits if you plan to work while receiving Social Security benefits

The Big Question: When Should I Apply For Retirement Benefits

The single biggest decision youll make when it comes to Social Security retirement benefits is when to apply.

Every persons situation is unique and so theres no single right answer. In general terms and based on life expectancies, Social Security retirement benefits are calculated to give you approximately the same total amount of benefits over your lifetime. If you decide to draw benefits earlier in your life, your average monthly amount will be less than if you delay and draw benefits later in life.

The amount you receive can vary widely. For example, if you were born in 1953 or 1954 and you were entitled to draw a $1,000 benefit at your full retirement age of 66, that amount would be $750 if you decided to draw benefits starting at age 62. But in that same scenario, if you delayed benefits until age 70, the amount would jump to $1,350.

There is no exact science when deciding when to apply, but here are some things to consider as you decide whats best for you.

This Is How Social Security Benefits Are Handled At Death

  • Using someone else’s Social Security benefits after they die is a federal crime.
  • Funeral homes often alert the government when someone passes away.
  • Depending on the situation, survivors benefits may be available.

There is a lot to deal with when a loved one passes away.

On top of the emotional aspect of handling death, there is the financial stuff which would include any Social Security benefits the deceased was receiving.

You may wonder how the government knows to stop sending that monthly money or whether a surviving spouse or dependent can keep some sort of payment going.

Social Security rules can be complicated. Yet the bottom line is that the decedent’s benefits stop at death. For survivors, how to get benefits or whether you qualify depends on several factors .

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First, though, it’s important for the Social Security Administration to be alerted as soon as possible after the person dies.

In most cases, funeral homes notify the government. There’s a form available that those businesses use to report the death.

“The person serving as executor or the surviving spouse can also call Social Security,” said certified financial planner Peggy Sherman, a lead advisor at Briaud Financial Advisors in College Station, Texas.

There are a couple of things to keep in mind. For starters, a person is due no Social Security benefits for the month of their death.

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Social Security Spousal Benefits

You may be able to get spouses retirement benefits even if you have never worked under Social Security. Your spouse must already be receiving retirement or disability benefits and you must be at least 62 years of age, and you can also qualify for Medicare if you are at least 65 years of age. You can receive spousal benefits no matter how old you are if you are caring for your spouses child who is also receiving benefits. To receive benefits, a child must be unmarried and either be under age 18 or be age 18-19 and a full-time student they can also receive benefits if they are 18 or over and disabled with a disability that started before the age of 22.

You can also receive spousal benefits even if you are divorced, if the marriage lasted ten years or longer. You must be unmarried, at least 62, your spouse must be entitled to Social Security retirement or disability benefits, and the amount of the benefit you receive based on your own work must be less than the benefit you would receive from your ex-spouses work. To apply for Social Security spousal benefits, you can use the online application you can call Social Security at 1-800-772-1213 or for the deaf and hard of hearing, 1-800-325-0778 or you can make an appointment and visit your local Social Security office. If you do not live in the U.S. or in a U.S. territory, you can contact the nearest Social Security office, U.S. Embassy, or consulate

Paying Taxes On Your Retirement Benefits

Should You Delay Applying For Social Security Past Age 70?

Social Security retirement benefit recipients must pay Federal income taxes on their benefits. Due to personal income levels, about one-third of recipients actually have to pay some amount annually.

Each year, the Social Security Administration will mail recipients a Form SSA-1099 that shows the amount of benefits received during the preceding year. This form should be used to complete tax returns and help determine in any taxes are owed.

As a general rule, if you file as an individual and your combined income is between $25,000 and $34,000, you may have to pay taxes on up to 50 percent of your Social Security benefits. If your combined income is more than $34,000 you may be required to pay taxes on up to 85 percent of your benefits.

If you file a joint return and you and your spouses income is between $32,000 and $44,000, then 50 percent of your benefits may be taxed. If your combined income is about $44,000, then up to 85 percent of your benefits may be subject to income tax.

To assist with tax planning, Social Security can withhold Federal taxes throughout the year for benefit recipients which may be preferable to making quarterly estimated tax payments.

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Which Types Of Income Reduce Your Social Security Benefits

If you’re younger than full retirement age, certain types of income that contribute to your yearly earnings limit can reduce your benefit amount. Such income includes wages paid to you for working and net earnings from self-employment. Income that does not reduce benefits includes interest, annuities, capital gains, investment earnings, pensions, and other government benefits.

A Hard Number To Snag

To qualify for the maximum Social Security benefit, you need to do three things:

  • Work at least 35 years
  • Earn an income for at least 35 years that’s equal to or beyond the wage cap each year
  • Delay your Social Security filing until age 70

See, Social Security benefits are calculated based on your 35 highest-paid years in the labor force. And each year, there’s a wage cap put into place that determines how much income gets taxed for Social Security purposes.

This year, the wage cap is $147,000. Next year, it’s rising to $160,200. So to get the highest possible monthly benefit out of Social Security, you need to earn enough money for 35 years to meet or exceed the wage cap.

Finally, if you want the highest Social Security benefit, you’ll need to delay your claim until age 70. That will boost your benefit and potentially bring it up to $4,555.

It may be possible for you to work for 35 years, and it may also be pretty easy for you to exercise patience and delay your Social Security filing until your 70th birthday. But snagging a high enough wage to claim the maximum monthly benefit is a different story. So for that reason alone, a $4,555 monthly payday may not be in the cards for you.

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Don’t Worry If You Can’t Claim The Maximum Benefit

Most seniors don’t manage to score the highest possible Social Security benefit. In fact, it’s estimated that the average monthly benefit in 2023 will be $1,827, which is a far cry from $4,555.

Instead of worrying about claiming the maximum Social Security benefit, do what you can to help your benefit grow. That could mean delaying your filing, and also fighting for raises during your career to boost your income. Taking on a second job and growing your wages that way could also set you up for a higher Social Security benefit down the line.

At the same time, it’s generally not a good idea to retire on Social Security alone — even if you are eligible for the maximum monthly benefit. Do your best to build yourself a solid nest egg, whether by funding an IRA or contributing money to an employer-sponsored 401.

If you wind up with a Social Security benefit worth $2,000 a month but also manage to retire with a $1 million nest egg, you should end up in pretty good financial shape — even without the maximum monthly benefit.

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How to Calculate Your Social Security Benefits

You can get a good estimate of how much income you can expect to receive from Social Security by setting up a My Social Security* account with the Social Security Administration . Doing so will let you see the SSA’s record of your earnings, which you should revisit now and then, to make sure they’re correct. If they’re not, you might end up receiving smaller benefit checks than you’ve actually earned. Fixing errors in your record can be an effective way to increase your benefits.

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What You Need To Know About The New Social Security Benefit Increase

For the 70 million Americans who receive Social Security, experts say the significant increase in benefits slated for 2023 is much-anticipated and much-welcomed.

Social Security recipients, most of whom are over age 65, have seen their payments increase almost every year for more than four decades to keep up with the cost of inflation. When inflation is low as its been over the past decade or so those cost-of-living adjustments, or COLAs, have been fairly mild. But last year, the increase was big, and this year its even bigger.

To help cover the rising cost of food, housing, health care and other essentials, the Social Security Administration announced Thursday that beneficiaries would receive an 8.7-percent increase in their monthly payments. In a sign that the Federal Reserves efforts have not yet worked to puncture the elevated inflation rate, the Bureau of Labor Statistics also released its consumer price index for September on Thursday, showing prices rose 8.2 percent over the last year.

The 8.7 percent cost-of-living increase to Social Security payments for 2023 will be the largest jump in more than 40 years. Graphic by Jenna Cohen and Megan McGrew.

The COLA for 2023 is the largest increase since 1981 when inflation was even higher than it is today and is the fourth-largest jump ever.

Employment Injury Benefits Branch

This branch of Benefit provides coverage for an insured person who suffers an employment injury, that is an injury or death by way of an accident at work or a disease caused by the type of work he or she does. This Branch covers Employment Injury/Prescribed Disease Benefit, Constant Attendance Allowance, Disablement Allowance and Death Benefit.

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Despite Spending At Least $250 Million To Modernize Its Vocational System The Agency Still Relies On 45

He had made it through four years of denials and appeals, and Robert Heard was finally before a Social Security judge who would decide whether he qualified for disability benefits. Two debilitating strokes had left the 47-year-old electrician with halting speech, an enlarged heart and violent tremors.

There was just one final step: A vocational expert hired by the Social Security Administration had to tell the judge if there was any work Heard could still do despite his condition. Heard was stunned as the expert canvassedhis computer and announced his findings: He could find work as a nut sorter, a dowel inspector or an egg processor jobs that virtually no longer exist in the United States.

Whatever it is that does those things, machines do it now, said Heard, who lives on food stamps and a small stipend from his parents in a subsidized apartment in Tullahoma, Tenn. Honestly, if they could see my shaking, they would see I couldnt sort any nuts. Id spill them all over the floor.

He was still hopeful the administrative law judge hearing his claim for $1,300 to $1,700 per month in benefits had understood his limitations.

Every year, thousands of claimants like Heard find themselves blocked at this crucial last step in the arduous process of applying for disability benefits, thanks to labor market data that was last updated 45 years ago.

A Guide On Taking Social Security

Everything You Need to Know About Social Security Retirement Benefits ...

Deciding when to take Social Security depends heavily on your circumstances. You can start taking it as early as age 62 , or you can wait until you’ve reached full retirement age or age 70 based on your work history. While there’s no “correct” claiming age for everybody, the rule of thumb is that if you can afford to wait, delaying Social Security can pay off over a long retirement. Here are some guidelines to consider.

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What Is A Social Security Card

Your Social Security card is an important piece of identification. You’ll need one to get a job, collect Social Security, or receive other government benefits.

When you apply for a Social Security number , the Social Security Administration will assign you a nine-digit number. This is the same number that is printed on the Social Security card that SSA will issue you. If you change your name, you will need to get a corrected card.

Other Pensions Might Reduce Your Social Security Benefits

Your benefits will be affected if you have a pension from a job that didnt have Social Security taxes taken out of your paycheck. Common examples include people who worked for a public education system, railroad workers and Federal government employees hired before 1984 who are covered by the Civil Service Retirement System .

Two complicated provisions will affect your claiming strategy: the Windfall Elimination Provision and the Government Pension Offset . The WEP reduces your own benefits by a discounted factor based on how many years you worked in jobs that did not withhold Social Security taxes. The GPO reduces your spousal and survivor benefits by two-thirds of the amount of your noncovered pension.

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To Wait Or Not To Wait

Consider taking benefits earlier if . . .

  • You are no longer working and can’t make ends meet without your benefits.
  • You are in poor health and don’t expect the surviving member of the household to make it to average life expectancy.
  • You are the lower-earning spouse, and your higher-earning spouse can wait to file for a higher benefit.

Consider waiting to take benefits if . . .

  • You are still working and make enough to impact the taxability of your benefits.
  • Either you or your spouse are in good health and expect to exceed average life expectancy.
  • You are the higher-earning spouse and want to be sure your surviving spouse receives the highest possible benefit.

Long Term Benefits Branch

What is my Social Security?

In order for a Long-Term Benefit to be paid, there are contribution conditions to be met. Payments for these benefits can be in the form of pensions or grants, determined by the number of accumulated paid contributions to the scheme. The Long-Term Benefits Branch provides coverage for: Retirement, Survivors, Invalidity and Non- Contributory Pension outlined as follows.

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Policy Basics: Top Ten Facts About Social Security

Social Security provides a foundation of income on which workers can build to plan for their retirement. It also provides valuable social insurance protection to workers who become disabled and to families whose breadwinner dies.

Eighty-six years after President Franklin Roosevelt signed the Social Security Act on August 14, 1935, Social Security remains one of the nations most successful, effective, and popular programs.

Who Is Eligible For Social Security Retirement Benefits

The U.S. Congress passed the 1935 Social Security Act as a way to supplement retirement earnings for primary working Americans. The original law also included the nations first unemployment insurance program as well as several health and welfare programs. Shortly thereafter, the law was changed to add survivor benefits for spouses and children, and in 1956 disability benefits were also added.

The Social Security Administration now serves 60 million Americans who will receive $870 billion in benefits in 2015.

The administration of such a large benefits program can be complicated at times, with numerous special instances, exceptions and nuances that can impact how benefits are disbursed to recipients.

This guide will introduce applicants to the basics of applying for Social Security retirement benefits and answer many of the common questions that arise when first considering to apply for benefits.

It will also address many special circumstances that can arise involving spouses and children, specific circumstances regarding timing, amounts, and maximizing benefits while also offering a comprehensive list of resources that may prove valuable throughout the Social Security retirement benefits process.

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How To Stop Social Security Check Payments

The SSA can not pay benefits for the month of a recipients death. That means if the person died in July, the check received in August must be returned. Find out how to return a check to the SSA.

If the payment is by direct deposit, notify the financial institution as soon as possible so it can return any payments received after death. For more about the requirement to return benefits for the month of a beneficiarys death, see the top of page 11 of this SSA publication.

Family members may be eligible for Social Security survivors benefits when a person getting benefits dies. Visit the SSA’s Survivors Benefits page to learn more.

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