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Frequently Asked Social Security Questions

There’s a lot to consider when you’re nearing retirement, and Social Security retirement benefits will probably be front of mind. Here, we discuss some of the most commonly-asked questions about the federal retirement program.

When Can I Retire?
Depending on the year you were born, you will be eligible for full retirement benefits as early as age 65 and as late as age 67. You can choose to receive early retirement benefits when you turn 62, but if you do that, your monthly benefit payments will be reduced permanently.

How Do I Become Eligible for Retirement Benefits?
In order to qualify to receive Social Security Retirement benefits, you must have earned enough credits during your working years. You can earn a maximum of 4 credits each year. If you were born in 1939 or later, you will need 40 credits to retire, which is the equivalent of 10 working years. Once you have earned the minimum number of credits, your monthly benefit payments will be based on the highest 35 working years’ averaged earnings.

Can I Qualify for Spousal Benefits?
Even if you have never worked, you may be eligible to collect retirement benefits on your spouse’s working record. In order to do so, your spouse must already be receiving retirement or disability benefits, and you must already be 62 years old. If you are a widow or widower, you can qualify for 100% of your deceased partner’s benefits, unless your own retirement benefits will be higher.

What Is the Maximum I Can Receive?
As of November 2019, the average monthly Social Security retirement benefit payment was $1,478. As we mentioned above, your payment is determined by multiple factors, one of which is based on the amount of money you earned while you worked. The most any one individual can earn if he or she reaches full retirement age in 2020 is $3,011 per month.

When and How Will I Receive My Payments?
The day on which you receive your monthly benefit payments is determined by your date of birth. Monthly payments are no longer delivered by check. Anyone who applies and qualifies for retirement benefits must set up direct deposit.

Will My Payments Ever Increase?
Social Security retirement benefits were only designed to replace about 40% of the average worker’s wages. Studies show, however, that over 60% of retirees rely on Social Security for at least half of their monthly income, and almost 40% of retirees count on their monthly checks for 90% or more of their income. Payments are supposed to be adjusted for inflation, but the increased costs of health care in the United States are not factored into that equation, and health care for retired Americans is increasing at a rate retirement benefits cannot match.

Will Social Security Run Out?
The short answer is “no”—as long as there are working Americans whose wages are taxed, there will be money in the Social Security trust fund. However, the dynamics of the workforce are changing, and more people are retiring than there are new workers to pay for their benefits in taxes. Also, there are more workers working for less money, and there are more individuals whose incomes exceed the maximum taxation threshold; therefore, even if the workforce were keeping up with the number of retirees collecting from the system, there would be less money to go around. Eventually, Social Security will not be able to pay out monthly benefits to retirees at the same level they are now. Starting in 2020, Social Security’s costs will begin to exceed its income, and the program will have to start dipping into the trust fund to make up the difference. If things do not change, Social Security will only be able to pay the full benefit amounts until 2035. After that point, everyone receiving retirement benefits will get reduced monthly payments.