How To Qualify For Retirement Benefits
When you work and pay Social Security taxes, you earn "credits" towards social services
. The number of credits you need to get retirement benefits depends on when you were born. If you were born in 1929 or later, you need 40 credits. This means ten years of work.
If you stop working until you have enough credits to qualify for benefits, credits remain on your Social Security record. If you return to work later, you can add more credits so that you qualify. No pension can be paid until you have the required number of credits.
Now, how much will your retirement benefit be? You see, your payment of benefits is based on the amount you earned during your career. Higher lifetime earnings result in higher profits. If there are years when not working or low income, the amount of your benefit may be less than if you had worked steadily. The benefit payment is also affected by the age at which you decide to retire. If you retire at age 62, your benefit will be lower than if you wait until after retirement.
To help you better understand retirement, here are its types briefly explained.
Full retirement age
If you were born in 1942 or before, who are already eligible for the full benefit of social security. If you were born from 1943 to 1960, the age at which retirement benefits are payable rises gradually until age 67.
Early retirement
You can receive Social Security benefits at age 62 already, but if you retire before full retirement age, your benefits reduced based on age. For example, if you retire at age 62, your benefit would be about 25 percent less than you would if you waited until full retirement age. Some people stop working before the age of 62 years. And, if they do, a year without revenue is likely to result with lower social security benefit at retirement.
Delayed retirement
You can choose to keep working even beyond your full retirement. If you do, you can increase your Social Security benefits in two ways. Each additional year of work adds another year of earnings to your Social Security record. Higher lifetime earnings may mean higher benefits at retirement
Moreover, the benefit will automatically increase by a certain percentage of the time you reach full retirement age until you start receiving benefits, or until age 70. The percentage varies depending on the year of birth.
by: Diana Ross
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