Approaching retirement? If so, Social Security is likely in your future. Nearly 90 percent of all Americans age 65 and older receive Social Security benefits. That’s almost 46 million retirees and their dependents.1

Just how much of a role will Social Security play in your retirement? That depends on a number of factors, including your age. The Urban Institute recently estimated that the average baby boomer retiree filing for benefits in 2020 will receive a total of $500,000 in benefits over the course of their lifetime. The average millennial retiring in 2050 is projected to receive $1 million in retirement benefits.2

Those are broad estimates, though. To plan your retirement income, you’ll need to consider factors specific to your goals and needs, including your work history and when you plan to file for benefits. The Social Security Administration offers a benefit estimator to help you plan.


Career Earnings


One of the biggest factors in your Social Security benefit amount is your career earnings history. Social Security collects taxes out of your paycheck throughout your career. To qualify for Social Security benefits, you must have a minimum of 40 quarters of work history.3

Social Security uses an average of your earnings over 35 years to calculate your benefit. If you have more than 35 years of work history, Social Security will drop your lowest earning years in the average calculation. If you have fewer than 35 years of history, Social Security will count any missing years as zero earnings.3


Filing Age


Another major factor in your benefit amount is the age at which you file. Remember, Social Security uses an average of your career earnings to calculate your benefit. To get that full benefit amount, however, you must file at your full retirement age (FRA). Most people’s FRA falls between their 66th and 67th birthdays.4

You don’t have to file at your full retirement age, though. You can file at age 62, but doing so will result in a reduction of benefits. The earlier you file, the greater the reduction. For example, if your FRA is 67 and you file at age 62, your benefit will be reduced nearly 30 percent. If your FRA is 67 and you file at age 66, the reduction is only 6.7 percent. Keep in mind that these reductions are permanent.4

You can also wait past your FRA to file for benefits. Social Security offers an 8 percent annual increase in benefits for every year you wait past your FRA. The longest you can wait to file is age 70. If your FRA is 66 and you wait until age 70 to file, your benefit will increase by a cumulative 32 percent.4

Not sure how Social Security will fit into your retirement income puzzle? Let’s talk about it. Contact us today at Spicer Wealth. We can help you analyze your benefits and develop a projection. Let’s connect soon and start the conversation.







Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.

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