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When Can You Start To Receive Social Security

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Reasons You Should Claim Social Security Early

Should you take your Social Security benefits at age 62?

Learn why Social Security at 62 might not be a bad idea. Social Security 101

Your retirement planning likely includes getting income from the Social Security Administration, but when you start collecting Social Security benefits can have a big impact on your planning. The earliest you can collect is age 62, but youll get more money if you delay your benefits past your initial Social Security eligibility. If you wait until after your full retirement age to start collecting Social Security you can earn delayed retirement credits, which will increase your benefits even more.

Read: When Social Security Runs Out: What the Program Will Look Like in 2035

You might think that waiting for bigger benefits is better, but thats not always the case. There is no definitive answer to when you should collect Social Security benefits, and taking them as soon as you hit the early retirement age of 62 might be the best financial move.

What Happens If You Claim After Your Fra

If you wait until your age 70 to start claiming benefits, then youll get an extra 8% per yearor, in total, 132% of your primary insurance amount for the rest of your life. Claiming after you turn 70 doesnt increase your benefits further, so theres no reason to wait longer than that.

The longer you can afford to wait after age 62 , the larger your monthly benefit will be. Nevertheless, delaying benefits doesnt necessarily mean that youll come out ahead overall. Other factors should be considered, including your expected longevity and whether you plan to file for spousal benefits. You should also consider the tax, investment opportunity, and health coverage implications.

When Should You Start Social Security

The Social Security Administration does not have a recommended age to start receiving benefits. The decision is entirely up to you. You’ll get a little less if you start early, or a bigger benefit if you wait until 70. You can calculate the difference on the SSA website. You may receive a bigger payout over your lifetime if you wait, but that might not be as important as receiving income now, especially if you can no longer work for health reasons. Ultimately, the right age depends on your financial situation, your work, and your health.

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Fact #: Most Elderly Beneficiaries Rely On Social Security For The Majority Of Their Income

Social Security provides the majority of income to most elderly Americans. For about half of seniors, it provides at least 50 percent of their income, and for about 1 in 4 seniors, it provides at least 90 percent of income, across multiple surveys and the study that matches survey and administrative data.

What Other Factors Should You Consider When Deciding To Collect Social Security

Key Considerations as You Start Receiving Social Security ...

Before you decide to collect Social Security based on your break even point, you should also consider how collecting early or delaying could impact the benefit your spouse receives.

Since the Social Security formula benefit is based on an individual’s 35 highest earning years, women often collect less in benefits than men because of career breaks during motherhood and overall lower lifetime earnings. However, the Social Security spousal benefit erases some of the disparity in Social Security earnings between men and women.

The spousal benefit is available to all spouses, regardless of whether the spouse has a work history or not . The spousal benefit is 50% of the higher earner’s benefit and in order for a spouse to receive the benefit, the higher-earner must be collecting their own benefit.

The Social Security administration automatically determines whether an individual would earn more in Social Security benefits if they collected on their own work record versus their partner’s work record.

For example, if the higher earner receives a $2,000 monthly benefit, the spouse is eligible to receive up to $1,000, depending on whether they choose to wait until full retirement age, says Kiner. For example, if someone collects the spousal benefit four years before full retirement age, their benefit will be 35% of the higher-earner’s benefits.

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Who Can Receive The Old Age Security Pension

If you live in Canada

You must:

  • be 65 or older
  • be a Canadian citizen or a legal resident of Canada at the time we approve your pension application
  • have lived in Canada for at least 10 years after turning 18 years old

If you live outside Canada

You must:

  • be 65 or older
  • have been a Canadian citizen or legal resident of Canada on the day before you left Canada
  • have lived in Canada for at least 20 years after turning 18 years old

If you do not meet the requirements listed above, you may still qualify for a pension from another country, from Canada, or from both if you have:

  • lived in one of the countries with which Canada has a social security agreement in force
  • contributed to the social security system of one of the countries with which Canada has a social security agreement in force

To see the list of countries with which Canada has a social security agreement, visit Lived or living outside Canada – Pension and benefits.

How Retirement Benefits Work

Social Security replaces a percentage of your pre-retirement income based on their lifetime earnings. The portion of your pre-retirement wages that Social Security replaces is based on your highest 35 years of earnings and varies depending on how much you earn and when you choose to start benefits.

When you work, you pay taxes into Social Security. We use the tax money to pay benefits to:

  • People who have already retired.
  • People who are disabled.
  • Survivors of workers who have died.
  • Dependents of beneficiaries.

The money you pay in taxes isnt held in a personal account for you to use when you get benefits. We use your taxes to pay people who are getting benefits right now. Any unused money goes to the Social Security trust fund that pays monthly benefits to you and your family when you start receiving retirement benefits.

Additional Information

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What If I Stop Working In The Middle Of The Year

There’s a special rule for when you work part of the year but then retire. Regardless of your total earnings, you’re still entitled to get Social Security checks for any month in which you’ve officially retired.

As an example, say you retire early at 63 and decide that you’re going to quit your $200,000-per-year job at the end of June. You’d forfeit all of your benefits for the first six months of the year because of your high earnings, but, starting in July, you could still get checks for the remaining six months even though your total annual earnings were well above the annual limit.

How To Deposit Social Security Benefit Checks

When Can I Start Collecting My Social Security

If the SSA is able to send payments to the foreign country where you plan to spend retirement, you have a few options. You can have the checks sent to that country, or you can have them deposited into either a U.S.-based bank account or a foreign account held in a country with an international direct deposit agreement.

Direct deposit is the fastest, most secure way to receive payments. Keep in mind that it will often take longer to receive paper Social Security checks outside the U.S.

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How Payments Are Paid

There are two primary ways to receive your Social Security benefit checks:

  • Direct deposit to your bank account, or
  • Direct Express debit card. In 2013, the Social Security Administration stopped mailing out benefit checks in order to reduce expenses.
  • To set up a direct deposit you have three options:

    • Configure through My profile tab in your online Social Security account
    • Ask your bank to do it

    If you choose to receive through a Direct Express debit card, your benefits will be placed directly onto the card. From there, you can withdraw cash, make purchases or pay bills. To sign up, call Direct Express at 800-333-1795.

    Do I Qualify For The Exception To This Rule Can I Draw Both Ssdi And Retirement

    There is one exception that allows qualified individuals to draw both retirement and SSDI benefits at the same time, but this is rare and still does not allow them to collect more than their full retirement benefit.

    This occurs when someone opts for early retirement between age 62 and their full retirement age but is then approved for SSDI benefits. Some people set themselves up for this by filing for early retirement after an injury or illness caused them to have to quit work. They can begin receiving early retirement to help them cover bills until their SSDI claim receives approval and the waiting period for those benefits expires.

    Once this happens, they can begin receiving additional money from the SSA each month on top of their early retirement benefits. This will bring them to their full retirement benefit amount. They are also most likely qualified for retroactive benefits, which will bring them to their full retirement amount for any month they suffered a disability but were not yet approved for SSDI.

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    Claiming Benefits As A Non

    If you arent a U.S. citizen, you must be eligible for benefits and reside in a country where you can receive payments. You also must meet one of the following conditions to receive Social Security payments while you live abroad.

    • You qualified for monthly Social Security benefits in December 1956, or the person on whose record your payments are based died or became disabled while in the U.S. military service and was not dishonorably discharged.
    • You qualify for benefits based on your earnings and are in active military service or had covered railroad employment.
    • You are a citizen of a limited set of countries including Canada, the United Kingdom, South Korea, and Israel.
    • You qualify for benefits based on your earnings and are a citizen of a broader set of countries including Mexico, Turkey, Costa Rica, and Jamaica.
    • You are a citizen of countries such as China, India, Haiti, and South Africa, and earned at least 40 Social Security credits or lived in the U.S for a decade.
    • You are a resident of a country that has a U.S. Social Security agreement, such as Canada, Australia, Sweden, and Spain.

    If you’re not sure whether you meet the criteria, use the Payment Abroad Screening Tool. Once you specify that you are a non-citizen, the tool will ask you some questions to figure out whether you can receive Social Security if you live abroad.

    How Your Social Security Benefits Are Earned

    Key Considerations as You Start Receiving Social Security ...

    To be eligible for Social Security benefits in retirement, you must earn at least 40 “credits” throughout your career. You can earn as many as four credits each year, so it takes 10 years of work to qualify for Social Security.

    In 2021, you must earn $1,470 to get one Social Security work credit and $5,880 to get the maximum four credits for the year.

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    Receiving Benefits As A Us Citizen Living Abroad

    While Social Security wasnt designed to be the sole source of income for retirees, it does make accommodations for those living abroad. If you are a U.S. citizen, you may continue to receive Social Security payments while you live abroad if you meet two conditions.

    You are eligible for payment. This means that you qualify for Social Security benefits based on your earnings record.

    When you work and pay Social Security taxes, you earn credits toward Social Security benefits. The number of credits you need in order to receive retirement benefits depends on when you were born. If you were born in 1929 or later, you need 40 credits .

    If you left the workforce before you had enough credits to qualify for benefits, the credits will remain on your Social Security record. If you return to work later, you can add more credits to qualify.

    The bottom line: The Social Security Administration cannot pay you any retirement benefits until you have the required number of credits.

    You are in a country where the Social Security Administration can send payments. To find out whether the SSA can send payments to the country where you plan to spend your retirement, use the Social Security Administration’s Payment Abroad Screening Tool.

    You will be notified of your eligibility based on the country you specify as your new residence.

    When Will I Receive My Payments Each Month

    If you sign up for direct deposit, your payment is automatically deposited into your bank account on the third from last banking day of each month, otherwise it will be sent to you by mail, usually during the last three banking days of each month.

    If you are automatically enrolled for the OAS pension and if you currently receive a CPP benefit by direct deposit, we will deposit your OAS pension payments to the same account.

    For more information or to sign up for direct deposit, visit the Direct deposit page or contact us.

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    Social Security Is A Critical Source Of Retirement Income

    Some have the perception that Social Security is of secondary or even tertiary importance in retirement. But according to a 2021 report by the Employee Benefits Research Institute, Social Security represents a major source of income for 62% of retirees.1

    Keep in mind that Social Security makes annual cost-of-living adjustments based on the Consumer Price Index, and under current laws, pays income for life and the life of your spouse.2

    Children Can Also Collect Social Security Benefits

    How You Can Stop and Restart Social Security Benefits

    Minor children of Social Security beneficiaries can be eligible for benefits. Children up to age 18 and disabled children older than 18 may be able to receive up to half of a parent’s Social Security benefit. The disability must have occurred before the age of 22. The adult child can continue collecting the benefit even after the parent has died, as long as the disability prevents them from working.

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    Social Security Disability Programs

    In addition to retirement benefits, the Social Security Administration manages two programs that provide benefits to people who are disabled or blind.

    Social Security Disability Insurance Program
    SSDI supports disabled or blind individuals by providing benefits based on their workers contributions to the Social Security trust fund. Your contributions are based on your earnings or your spouses or parents earnings while in the workforce. Your dependents may also be eligible for SSDI benefits based on your earnings.
    Supplemental Security Income Program
    SSI benefits are paid out as cash assistance to people with limited incomes and resources who are elderly, blind or disabled. These benefits may also include blind or disabled children. SSI payments are a federal benefit funded by the general fund of the United States not the Social Security trust fund. Some states provide additional state supplemental benefits in addition to the federal SSI payments.

    In some cases, people may be eligible for both SSI and SSDI at the same time. The Social Security Administration calls these concurrent benefits. This can happen when a disability qualifies you for Social Security Disability Benefits, but you only get a small amount of monthly SSDI benefits. This may qualify you to receive SSI benefits as well.

    Comparing SSDI and SSI Programs

    FEATURE
    Up to 85%

    Income Taxes for Other Benefit Programs

    Can I Receive My Pension Outside Canada

    Yes. Usually, we can send your pension payment outside the country if you:

    • lived in Canada for at least 20 years after turning age 18
    • lived or worked in a country that has a social security agreement in force with Canada and you meet the 20 year residence requirement under the provisions of that agreement

    If you do not meet either of the above requirements, we can only send your pension payments outside Canada for the month you left and for six months after that.

    Example: If you left Canada in January, we would send your payments until the end of July. After July, the payments would stop.

    If you return to Canada after being away for more than six months, every additional year in Canada will be counted in order for you to reach your 20 years of residence to receive your OAS pension outside the country.

    If you plan to be absent from Canada for more than six months, you must call us. You should also let us know when you return to Canada so that we can restart your pension payments, beginning the month you return. It is important to let Service Canada know this information to ensure that you receive the amount you are entitled to, and also to avoid potential penalties and having to repay any amount that you were not entitled to receive.

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    Youre Only Working Part Time

    If you claim Social Security prior to your full retirement age while still holding down a part-time job, you might have your benefits reduced if your work income exceeds the annual limit. For 2021, if you are under full retirement age, your benefits go down by $1 for every $2 your income exceeds $18,960. If you reach full retirement age in 2021, your benefits go down by $1 for every $3 your income exceeds $50,520 prior to reaching full retirement age. If youre working part-time to help make ends meet, taking Social Security at 62 might make sense.

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