Social Security limitations

Well, according to this link, the maximum benefits a married couple can get appear to be $2,533 + $1,266.50 or $3,799.50/month. $45,594/yr for a married couple sounds pretty sweet. Now, how to get to that level while working within the Social Security limitation?

  1. Get to the maximum earnings level as soon as possible. SS is based off of the highest 35 years of earnings. And if you don’t have earnings for 35 years, they may graciously put in a zero as part of the calculation which could lower your benefits.
  2. If you can’t get to the maximum earnings level, then try to plan drawing Social Security when you are 70. The amount of your check increases about 8%/yr for every year after your full retirement age (up until age 70).
  3. Try to wait until your full retirement age (67 years old, or a little less, for most baby boomers, and age 67 for everybody else). SS Chart
  4. Use your spousal benefits if it makes more sense. If your incomes are largely different, you can receive 50% of the highest earner’s SS benefits. Since the largest amount is $2,533/month, then the spouse can receive $1,266.50/month if the higher earner has reached full retirement age.
  5. In the case of families that have dual incomes and enough credits, if the spouse that earns less has a larger amount at age 70 than their spousal benefits allows for, then they can change the benefits that they are claiming to their own (since they have achieved the maximum SS payment based on their own benefits.
  6. If you can manage to earn $38k/yr+ after you retire, it would be best to not earn that much until after you’ve reached full retirement age. Otherwise your SS check will be lowered by $1 for every $2 that you earn above $15,120 (or $14,640 if you are single).

In case you’re wondering, the SS office is pushing for automatic deposits of your Social Security checks starting March 1, 2013. As a matter of fact, if you don’t have automatic deposit in place for your SS check by that date your SS check may be late and it won’t be a check, it will be a prepaid debit card.

PS: In case the link above doesn’t work, here it is: http://www.ssa.gov/policy/docs/quickfacts/prog_highlights/index.html

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