Consider retirement issues along with Social Security
BY MARY CURRIE
Monday, May 27, 2019
In the last column I had a little about retirement accounts — make sure you have in place a beneficiary listed, so when you pass away your retirement accounts will automatically be available to the ones you wish to receive these funds.
This will make sure the ones you want to receive your funds will be automatically taken care of and potentially save a substantial amount of money in fees if no beneficiary is provided.
Along this line of retirement thinking is Social Security decisions — when to start, age, and taxes.
There are many factors that impact the decision of when to start drawing on your Social Security, such as disability, loss of a job, need of additional income and age. These factors may override the other factors of when to start drawing.
What age do I start drawing Social Security?
There are three ages to consider in drawing your social security; 62, full retirement age and 70. Age 62 is considered early retirement — you will receive less each month when you start at 62. Full retirement age depends on the year in which you were born, if you were born in 1937 or earlier then 65 is considered full retirement, if you were born between 1943-1954 full retirement age is 66, and it goes up to if you were born 1960 or later then full retirement age is 67.
You will receive more per month at full retirement age than you would at 62. At age 70 is the year in which you would draw the most between these three age benefit alternatives. An example of these three different ages is: 62 years old, $1,480; full retirement age, $2,200; 70 years old, $2,800.
As you can see, it makes a difference which age you decide to start you Social Security. This is just an example — your numbers will differ. To get your actual numbers, go to you local Social Security office or go online to ssa.gov to get your actual numbers to help you make the best decision for your situation.
Social Security income is taxable for federal income tax depending on your total income — all other income plus portion of Social Security income.
People often confuse age 65 with Social Security. Now that we have covered the different ages for Social Security, remember you still need to sign up for Medicare about three months before turning 65 years old.
One more note, for those of you having an employer that has in their retirement plan the option of “leveling”, you need to get advice to see if that option is the best for you overall. You can get help through your HR department and your financial advisor in making this decision.
The information in this article is general in nature and should not be acted upon without first checking to determine its applicability to your situation.
Mary Currie is a certified public accountant practicing in Rocky Mount.