Retirement benefits: "When you work and pay Social Security taxes, you earn "credits toward Social Security benefits," said Social Security Administration press officer William "B.J." Jarrett in Baltimore, M.D. "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 (10 years of work). In 2013, you must earn $1,160 to receive one credit; you can earn a maximum of four credits per year.
"Your benefit payment is based on how much you earned during your working career. Higher lifetime earnings result in higher benefits. If there were some years when you did not work or had low earnings, your benefit amount may be lower than if you had worked steadily. Your benefit payment also is affected by the age at which you decide to retire. If you retire at age 62 (the earliest possible retirement age for Social Security), your benefit will be lower than if you wait until later to retire.
You may choose to keep working even beyond your full retirement age – 66 for those born 1946 through 1966. If you do, you can increase your future Social Security benefits in two ways. Each additional year you work adds another year of earnings to your Social Security record. Higher lifetime earnings may mean higher benefits when you retire.
Also, your benefit increase automatically by a certain percentage from the time you reach your full retirement age until you start receiving your benefits or until you reach age 70. If you were born in 1943 or later, the system adds 8 percent per year to your benefit each year you delay signing up for benefits beyond your full retirement age.
If you are age 60 or older and not receiving Social Security benefits, you receive a statement every year summarizing your earnings and estimating disability benefits you’ll receive if you become severely disabled before retirement, as well as survivors benefits estimates available to your spouse and eligible family members on your death.
Spousal and widow benefits: A spouse who has not worked or who has low earnings can be entitled to up to one-half of the retired worker’s full benefit. If you are eligible for both your own retirement benefits and for benefits as a spouse, the system always pays your own benefits first. If your benefits as a spouse are higher than your retirement benefits, you will get a combination of benefits equaling the higher spouse benefit.
On reaching your full retirement age and eligibility for spouse’s or ex-spouse’s benefits and your own retirement benefit, you may choose to receive only spouse’s benefits and keep accruing delayed credits on your own record. You may file for benefits later and receive a higher monthly benefit based on the effect of delayed retirement credits.
Your divorced spouse can get benefits on your Social Security record if the marriage lasted at least 10 years. Your divorced spouse must be 62 or older and unmarried. The amount of benefits he or she gets has no effect on the amount of benefits you or your current spouse can get.
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