COLUMBIA, Mo. – Little-known facts about Social Security can have a big impact on benefits, says Cynthia Crawford, University of Missouri Extension personal financial planning specialist.
• Divorced people over 62 may be able to draw Social Security spousal benefits if they were married 10 years or more and have not remarried. Crawford says former spouses do not need permission from their ex-spouses to draw spousal benefits. The Social Security Administration makes eligibility determinations. If these facts fit your situation, it is worth checking with Social Security to explore eligibility and benefit levels.
• You don’t have to apply for Social Security only on landmark ages of 62, 65 or 70. You can apply any time after 62. Your benefits increase for each month you delay application and that benefit increase lasts the rest of your life. But don’t wait until past 70 to file. Waiting past age 70 won’t increase your monthly benefits.
• While the age that you choose to begin receiving Social Security retirement benefits is flexible, you should sign up for Medicare three months before reaching age 65. If you choose not to enroll in Medicare Part B and then decide to do so later, your coverage may be delayed and you may have to pay substantially higher monthly premiums for as long as you have Part B. This is a deadline you can’t afford to miss, Crawford says.
• Go to the Social Security Administration’s website to ask specific questions. Representatives respond quickly. You can talk to a live person, send an email, send a letter, find an office or check online services at www.socialsecurity.gov/agency/contact. “Go straight to the source,” Crawford says, for accurate, up-to-date information.
• You can apply for Social Security benefits online. There is no need for a visit to the Social Security office.
• Many people wonder how their retirement benefit is calculated. Social Security benefits are based on your lifetime earnings. Your actual earnings are adjusted or “indexed” to account for changes in average wages since the year the earnings were received. Then Social Security calculates your average indexed monthly earnings during the 35 years in which you earned the most. Many think it is determined by the final five years of earnings, but this is not true, Crawford says.
• According to the Social Security Administration, 37 percent of those claiming benefits in 2014 were 62. Thirty-one percent wait until their full retirement age. Only 2.6 percent of workers wait until age 70 or older.
For more information, go to www.socialsecurity.gov.
For more personal finance information from MU Extension, including feature articles, answers to frequently asked questions and learning opportunities, go to www.MissouriFamilies.org/money.