Part of comprehensive estate and retirement planning includes understanding how Social Security benefits play into the grander picture of your financial affairs. To optimize your lifetime or monthly Social Security income you need to understand how Social Security benefits are calculated for each person.
The formula looks at your average earnings over a 35-year period where you earned the most money during your working lifetime. To boost this amount you either have to earn a higher salary or work longer at your higher earning capacity.
The amount you receive is also determined by the age in which you elect to start drawing benefits. If you delay until age 70 you receive more per month. The risk to delay is that you cannot predict your death date therefore you cannot predict your lifetime accumulation total of benefits.
There are tools (like SSA’s retirement calculator) and financial advisors that can run these numbers for you to help you make better choices on how long to work and when to start drawing your benefits. Experts also evaluate your spouse’s situation and coordinate the plan to maximize benefits for both of you. There are also other strategies available such as starting and stopping benefits which a seasoned advisor may explore in certain situations.
For a consultation on how Social Security works and plays into a comprehensive estate and retirement plan, contact Stouffer Legal at 443-470-3599 in the Greater Baltimore area.