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July 21, 2021
Applying for Social Security is very straightforward. In fact, applying is perhaps too easy for such an important decision. The more important and complicated question is: When to apply?
Just follow these 5 steps.
Make sure you make the right decision about when to apply. This is a decision that impacts the rest of your life. (See below.)
Make sure you are eligible.
To apply for Social Security benefits you must be at least 61 years and 9 months old and have worked at least ten years total at jobs where you earn Social Security credits.
Ninety six percent of all American workers are covered by Social Security.
This step might be the hardest part, but still very straightforward.
When it is time for you to apply for Social Security, you will want to gather the information and documents you will need for the application. These include:
With the information listed above, you should be able to complete your application.
Once your application is submitted, the Social Security Administration will contact you if they have any questions. You can also check the status of your application online.
See? So easy!
However, BEFORE you do ANY of the above, please carefully consider when exactly you want to start your benefits. This decision can make a huge difference in your financial well being in retirement. Keep reading for important guidance on this decision.
As stated above, you are eligible to apply for Social Security retirement benefits when you are 61 and nine months. You can start collecting benefits as soon as you turn 62.
However, just because you can, does not mean that you should.
The longer you delay starting your benefits, the more your monthly income will be. In fact, the difference in lifetime income between starting at age 62 and waiting until your maximum retirement age can be more than $100,000 — and for many people much much more.
While you can start benefits at age 62, the Social Security Administration (SSA) considers that “early.” Depending on your birth year, you do not reach what the SSA calls “full retirement age” until sometime between ages 66 and 67.
If you are confused about when to start, you can use the Social Security Explorer — part of the NewRetirement Retirement Planner to compare your monthly income and maximum lifetime payout at different ages.
Or, you might consider the following rules of thumb:
It can also be a very good idea to have an overall retirement plan before you decide when to start your Social Security benefits. The NewRetirement Retirement Planner can help you assess all of your sources of retirement income and whether or not you will have enough to cover your expenses. This tool was recently named a best retirement calculator by the American Association of Individual Investors (AAII).
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