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Claim Your Social Security Benefits When You Turn 65 To Get The Maximum Payment

Social Security Benefits
Social Security Benefits; Source- Forbes

During their working years, most people ask themselves when they can retire. The answer comes down to money in virtually all cases you need a certain amount to survive in retirement. Of course, you have to earn it now to have it then. Based on your present earnings and the rate of return on your investments, it is difficult to project your future income. Still, you can use general information such as the typical Social Security income at a given age to at least begin creating a retirement budget. For this exercise, 65 will be our age.

Social Security Benefits

Social Security Benefits; Source- MARCA

Social Security Retirement Income

Your retirement income should come from sources other than Social Security. It’s meant to supplement your retirement income merely a little bit. According to projections from the Social Security Administration, these payments will take the place of around 40% of your pre-retirement income, depending on your working-age income and savings. The remainder is left to you. Just keep in mind that, once you retire, you certainly won’t need to replace all of your income from employment. Generally speaking, you’ll need to replenish 80% of that quantity. Additionally, keep in mind that at age 65, you are not eligible for all of your planned Social Security benefits.

100% Of Social Security Monthly Payments

You can begin receiving a portion of your eventual benefits as early as 62, but you must wait until you reach your full retirement age, or FRA, before filing for benefits to begin receiving 100% of your planned monthly payments. The FRAs for anyone born after 1943 are displayed in the chart below. As you can see, for anyone born in or after 1960, the FRA is progressively increasing toward 67 years of age. On the other hand, you can accrue more benefits if you’re ready to delay collecting them. Social Security benefits for those who wait until they are 70 to start receiving them range from 24% to 32% larger than what they would receive at their official FRA.

Average Social Security Payout In 2024

In any event, 65-year-olds will get an average monthly Social Security payout of $1,505 in 2024. That comes to $18,060 a year. By the way, the number could have been lower. For those who apply for benefits at the earliest age of 62, the average amount is somewhat less than $1,300. On the other hand, if Social Security retirement benefits are postponed until age 70, the average monthly amount increases to $1,963. Additionally, the figure for 65-year-olds is significantly lower than the national average of $1,709 each month. Early benefit claims might be expensive. These figures above may persuade you to reconsider if you’ve only been considering claiming benefits at age 65 or at any other time before reaching your FRA.

After all, a couple hundred dollars a month, if not more, is not a tiny sum of money for the typical household. Having said that, don’t lose sight of the need to save money on your own in your quest to find the best methods to optimize your future Social Security income. Your personal nest fund has the potential to provide you with at least as much if not more, income in retirement as Social Security provided you with invest sensibly and consistently for growth. In light of this, consider the following additional general guidelines, which may aid in your retirement planning: If you set aside 15% of your earnings throughout your working life, you should be able to sustain your retirement quality of living.

Naturally, this computation assumes that you will work for thirty to thirty-five years, retiring in your sixties. It also implies you’ll make prudent investments and achieve quantifiable growth that surpasses the effects of inflation. If your income increased significantly later in life compared to your younger years, or vice versa, you might also need to modify the amount of your annual payment. Remember, this is only the beginning. But the final objective remains unchanged. In other words, save so much and build your retirement account to such an extent that, when the time comes for you to start receiving benefits from Social Security, you won’t even have to worry about how much your check will be.

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