Each month, we recognize or celebrate different national topics or themes. In addition to April serving as Social Security Month, it is also National Autism Awareness Month, National Lawn & Garden Month and about 35 other themes. It can be fun to pick one of these each month and educate yourself on the topic or recognize or celebrate it in some way.
As a financial services firm, April serves as a good time to focus on Social Security. There is so much information about Social Security that we could focus on it every month! Here we share with you some important facts to know:
1. You Can Choose When to Take Social Security: Full retirement age (FRA) varies based on your birth year. You can start receiving benefits when you become eligible at 62 but at a reduced rate of 70-75%. If you wait until your FRA, you will receive your full, unreduced benefit amount.
2. Your Social Security May be Taxable: Depending on your other income, you might have to pay taxes on your Social Security benefits. About one-third of Social Security recipients pay income tax on their benefits. These tax implications may affect whether or not you work during retirement, how you invest your assets and the withdrawals you take from other retirement accounts.
3. Your Spouse May Apply for Benefits: A married person who has little to no earnings’ history can claim a spousal benefit equal to half of the working spouse’s primary insurance amount (PIA). If a spouse will receive Social Security based on their work history, they can collect his or her own benefit first. If the spousal benefit is higher, he or she will receive the additional amount.
4. Both Widowhood and Divorce Affect Your Benefits: If both you and your spouse receive benefits when your spouse passes away, your spouse’s benefits will discontinue. However, you can then switch to your survivor benefits as long as you are over full retirement age when you claim it. If you are divorced, you may qualify for your ex-spouse’s benefits based on certain factors, such as how long you were married, how long you have been divorced and whether you remarried or not.
Visit the Social Security website for additional information on these topics and more: www.socialsecurity.gov. You can also join us May 10 for our LIVE Social Security Webinar. Our private wealth managers will discuss in more detail when to apply for benefits, how much you may receive and survivor benefits. RSVP today at www.sterlingfm.com/events for either 12:00 noon or 5:30 PM. We hope you will join us to learn more about this very important topic!