Your retirement options change regularly and that is due in part to the volatile economy. Keeping up with those changes can test one’s patience but the truth is, unless you do, your retirement plan can be affected in a negative way.
There is always the possibility that someday social security retirement benefits will be eliminated. However, whether that is necessary, wise or desirable is a political question.
Right now, consider this: every political discussion I can remember that had to do with reducing, eliminating, or changing the qualifications for social security retirement payments has come with the caveat that persons who are in the workforce and have been including social security benefits in their retirement planning must still be able to count on benefits.
So, if you are old enough to be in the workforce today, you will almost certainly get some kind of retirement benefit from the government when you reach retirement age.
Retirement Choices
How much, of course, gets less certain the younger you are. Political philosophy dedicated to reducing the size and costs of government that suggests changing social security to accomplish its goals will garner more support if change is gradual and does not pull the rug out from under those older workers who have far less time to make up the difference in their retirement portfolios by other savings vehicles.
The most important thing you can do is get educated every year about changes in social security. It is important and beneficial for you to go to the social security website and read everything applicable to you. This is especially true if you are turning 65 this year as one of the first of the Baby Boomer generation.
Highlights of some of the things you might want to consider are the benefits of signing up for Medicare as soon as you can and take advantage of the one-time free health exam available as of this year (2011). This can save you some money on medical costs that you can put away toward your asset portfolio.
Delaying Retirement Benefits
Also, consider not taking retirement benefits as soon as you are allowed because you won’t get the maximum benefit. Waiting just one more year gives you a significant monthly increase; even better, every year you don’t take benefits up to the age of 70 will increase your monthly benefits for the rest of your life that probably will translate into more money overall.
Keep in mind that your benefits are based on the average of your highest 35 years of work. If you have worked less than 35 years total, the years you did not have any income subject to social security tax will figure in as zeros in your 35-year “work history.”
Even working part-time for some years to make up for the lack in your full-time 35-years will help your average and increase your monthly benefits.
More Options For Retirement
Spouses of ten years or more have some interesting options, too. If one spouse has benefits that are more than double the other spouse’s benefits, the spouse with the lower benefit amount can get benefits equal to one-half the higher spouse’s benefits.
This is especially useful if the lower earning spouse is under 70 and can put off taking benefits for enough time that his or her eventual benefits will be more than one-half of the benefit level of the higher earning spouse.
Whatever you think about social security, it is important that you educate yourself and make the best use of whatever benefits are available to you. You paid in, so get your money’s worth.