Not saving enough for retirement is one of the most common financial mistakes that people make. There’s an area where many people make mistakes without even realizing it: Social Security benefits. Since Social Security makes up fifty percent or more of the income of about half of all people who are retired, a mistake in this area can have serious consequences. It’s important to be aware of these potential mistakes and avoid them.
Neglecting to set up your account on the Social Security website
You get lots of great information when you register for your own account on the Social Security website. For instance, you can find out how much you’re likely to receive in benefits, you can review the SSA’s record of your income, and you can see your contributions. Not registering for an account is a mistake, because if you don’t, you leave yourself open to identity theft. If someone manages to register for your Social Security account, they may use it to take advantage of your benefits.
Forgetting to check the SSA’s record of your income
Once you register for your SSA account, you can use it to check the SSA’s record of your total income. It’s important to look at their record very closely. If they underrecord your income by even one year, it’ll affect their calculations for how much you get in Social Security payments. It’s important to keep your own record of your earnings and check the SSA’s records against them. If there are discrepancies, you should have them corrected so that you don’t get shortchanged on your benefits.
Neglecting to find out what your full retirement age is
You only get your entire Social Security benefit when you retire at what the SSA defines as your full retirement age. It used to be sixty-five for everyone. Now, however, it depends on when you were born. Your full retirement age is still sixty-five if you were born in 1937 or earlier. If you were born in or after 1960, however, you only get your full benefits starting at age 67. You should find out what your full retirement age is, and not apply to collect your Social Security payments before you have reached full retirement age.
Continue reading on the next page to discover more social security mistakes that can cost you a fortune.