3 common mistakes which can cause you to lose retirement in the United States

The social security benefits can be a lifeline in retirement and to help bridge the gap between what you have and what you need to ensure a comfortable lifestyle, says Fox Business. However, many people may unintentionally deprive yourself of pensions in the United States.

3 распространенные ошибки, из-за которых вы можете лишиться пенсии в США

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Approximately 37% of people aged 60+ years, I consider social welfare as its main source of income in retirement, according to a report by the Center for retirement research Transamerica. If you have such plans, it is especially important to make sure that you know about some errors, due to which you may lose your payments.

1. Your experience is less than 35 years

To be eligible for retirement benefits, you generally have to work and pay taxes to social security for at least 10 years. However, if you have worked for at least 35 years old by the time when you started to apply for benefits, you may receive smaller checks.

The social security administration calculates the sum of the base benefit or the amount you will receive upon reaching full retirement age, using the average value of your income over 35 of the most successful years of your career and then adjusting it with inflation.

If you have not worked a full 35 years, your equation will be added zeros to account for those years when you were not working. This can lead to lower average income, which in turn will reduce the amount of the benefit.

2. You do not use all the types of benefits to which you are entitled

When you think of social security benefits is likely to come to mind pensions. But there are other types of benefits to which you may be entitled, including spousal benefits, benefits after divorce or the allowance for the survivor.

If your spouse (husband or wife) has higher income and is entitled to receive social security benefits, you may be entitled to benefits as his spouse (wife). The maximum amount you can get under the spousal benefits is 50% of the amount your spouse (husband) is entitled to receive at full retirement age. Similarly, if your former spouse (wife) is entitled to receive benefits, you may qualify for benefits after the divorce on the basis of his employment record if you were married at least 10 years and now it does not belong.

If you have the right to receive social security benefits based on their own employment record, the social security Administration will first pay them. Then, if you are eligible for more money in the form of benefits upon marriage or divorce, you’ll get a little bit more each month.

Benefits for survivors are usually provided to widows and widowers aged 60 years and older, but children, parents and other family members who were financially dependent on the deceased, are also sometimes entitled to these benefits.

3. You forget about taxes on social security

Despite the fact that you have years to pay into the social security program, the state would still try to get part of your benefits in taxes to state and Federal taxes.

Depending on where you live you can pay or not pay state taxes – each state has its own laws on this matter. In some there is no tax, in others it is based on your income.

The amount you will owe in Federal taxes will depend on your “gross income”, which is half the amount of your annual benefits plus other sources of income (excluding payments to a Roth IRA). If your total income is more than $34 000 per year (or $44 000 per year for couples who are married), you will have to pay Federal taxes on the amount to 85% of your benefits.

Although you may not be able to avoid the tax on benefits, you can do everything possible to advance their plan.

How to maximize your pension

The social security benefits are an integral part of the retirement plans of many Americans. It is reasonable to use them to their fullest. Making sure that you worked enough years to get full benefit amount, apply for all kinds of benefits to which you are entitled and do not forget to consider taxes. Then you’ll be on your way to achieving a stable financial situation for retirement.


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