There are those who assume that a ready-made retirement is right there for everyone, because they know that they will qualify for Social Security and Medicare.
To qualify for these programs, you have to accumulate at least 40 retirement credits while you are working and paying taxes. The requirement is quite modest, because in 2015, you get one credit for every $1220 that you earn. You can accumulate as many as four credits in a calendar year. So, when you combine these figures, if you work for at least 10 years earning a very minimal amount of money you will qualify.
The exact amount that you will receive from Social Security is calculated based on your top 35 earning years. You can find out how much you can expect to receive if you register your account on the Social Security Administration website, and this can be done quickly and easily.
Every eligible applicant can qualify for Medicare at the age of 65 at the present time. Your eligibility age for your full Social Security benefit depends upon your year of birth. If you were born in 1954 or earlier, your age of full eligibility is 66. The eligibility age then rises by two months per year, so someone born in 1955 would become eligible two months after his or her 66th birthday. This two months per year graduation ends in 1960 when it tops out at 67. People born in 1960 and later become eligible when they celebrate their 67th birthdays.
The average Social Security benefit for an individual recipient in 2015 is just $1328. Clearly, this is not going to be enough to support a comfortable retirement.
We should point out the fact that you do not have to wait until you are qualified to receive your full Social Security benefit. You can choose to receive a reduced benefit when you are as young as 62 years of age. The amount of the reduction would depend upon your birth year, but it would be somewhere between 25 percent and 30 percent.
No 2016 Cost of Living Increase
Each year the Social Security Administration can increase benefits to account for the rising cost of living. In 2015, there was a 1.7 percent cost of living adjustment or COLA. Since the end of the year is near, the Social Security Administration has announced that there will be no cost of living adjustment for 2016.
This is tough news for senior citizens are trying to get by on a fixed income.
Retirement Planning Consultation
To be able to retire in comfort, you have to stick to a logical plan for an extended period of time. If you would like to discuss your future with a licensed professional, contact us through the following link to set up a consultation: Dallas TX Retirement Planning Attorneys.