A number of things determine how much you get for monthly social security support. In theory, all through your career, you fund your social security by paying some amount of money as tax so that when you retire, you get a check every month based on how much you paid. But in practice, it is not that straightforward and other factors contribute.
Your monthly social security check is determined by these factors, the number of years you work, how much your salary and your age when you began collecting social security support.
Even if you are close to retirement, there is still something you can do to get an extra 24 percent out of your monthly social security.
WHAT YOU CAN DO TO GET 24 PERCENT MORE OF SOCIAL SECURITY
Wait until you get to the age of 70 before you claim your social security. If you start collecting social security from the retirement age of 67, you will get reduced benefits.
This plan will be easily executed if you work on getting another source of income to depend on until 70 years. You can get a side job or net proceeds from selling your own business.
It is important to consider your lifespan and overall health before adopting this plan. If you have an existing medical condition or you don’t expect to live until 70, you can claim social security before 70 and enjoy the money.
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You can also begin planning now in order to get a better retirement. The social security check is designed to replace 40 percent of your annual income or less for high-income earners. You will need to get an extra source of income if this will not be enough to fund your lifestyle after retirement.
To help with planning, there is a four percent rule concept. The concept determines how much you will need to save from your income.
For example, for every $1 in annual costs you need your portfolio to cover, you’ll want to have $25 invested at the time you retire. So if you think you’ll need $1,000 per month — $12,000 per year — above what Social Security will cover, you’ll want a portfolio worth $300,000 to make it work.