Goodbye Social Security checks: these are the most common mistakes when claiming retirement benefits

Sometimes, the requirements for qualifying for U.S. Social Security Administration payments can be confusing for beneficiaries. In this case, a new survey by Nationwide Financial has revealed that Social Security payments are a challenge for many retirees in the United States, as many people in the country don’t know if they are eligible or the optimal age to apply without losing money or purchasing power.

What is the full retirement age (FRA), and what should you know?

According to this survey, nearly half of Americans (49%) at retirement age don’t know how to maximize their benefits, and 33% aren’t sure of the age at which they should apply to receive full benefits. Sadly, this survey shows that many citizens are unaware of the administration’s rules and how to use them to their advantage.

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Full retirement age (FRA) is the age at which a person should retire to receive 100% of their Social Security benefits generated during their working years. Knowing this FRA is important, as next year, more than 72 million Americans will be eligible to apply for these Social Security benefits.

It is important to note that there will be changes to payee payments in 2025 due to COLA.

How can I know my retirement age?

To know your specific retirement age, you just need to consider the following:

Be aware that if you were born on the first day of the month, the SSA uses the previous month to calculate your FRA. Similarly, if you were born on January 1, they’ll calculate it from December of the previous year.

Financial strategy suggests that the longer you delay your retirement age, the larger your checks will be, but only up to a certain maximum. In this 2024 experts say there could be changes to the retirement age starting in 2025.

How does the Social Security Administration (SSA) define my FRA based on my years worked?

It’s also important to know that in addition to your birth year, the SSA considers the number of years you have worked and paid taxes when calculating your FRA. The optimal number of years worked to retire is 35. In other words, you should work at least 35 years to qualify for 100% of Social Security payments.

The SSA allows you to apply for retirement before reaching 35 years of work, provided you are at least 62 years old. Keep in mind, however, that if you apply before contributing for 35 years, your benefits will be reduced.

How can I know if I should apply for early retirement at 62?

To know if applying for early retirement between 62 and 65 is a good idea, keep in mind that this will permanently reduce your payments. The SSA allows beneficiaries who have applied for early retirement to cancel it within the first 12 months and return to work to fulfill 100% of the required time to qualify for full payments. If you return to work within the first 12 months of early retirement, you’ll need to repay any money received from Social Security.

Each beneficiary’s personal circumstances are another factor to consider when applying for early retirement. If your financial situation is strong, with profitable investments and sufficient savings, applying for early retirement may be the best option to enjoy this new phase of life.

Another case noted by experts involves health. People with health issues who don’t expect a long lifespan are another group who may benefit from requesting early benefits.

The U.S. government emphasizes the importance of being well-informed, as many citizens may be losing a substantial amount of money by not knowing the rules about retirement, which affects the purchasing power of the population. Remember that you can always check the phone numbers and contact methods with the Social Security administration to solve your doubts.

*This article was written in Spanish and translated with the help of AI.