Friday, May 30, 2014

Before starting Social Security benefits, look at the top 35 years of your earnings

Here’s a good point that just occurred to me.  I did start Social Security benefits at age 62, partly because my pension “social security offset” kicked in (that is, my “social security bridge” expired).
Had I kept working full time even at an hourly wage until age 66 (full retirement age in my case) however, the mathematics would have worked out better for me (SSA explains it here).  Not only is the benefit higher because actuarially it is drawn over fewer years, but the important number that averages the top 35 years of earnings improves.  Social Security explains it here.  I worked as a “salaried professional” for 29 years (there was 19 months as a federal employee in 1971-72, before federal employees contributed to social security).  The rest of the years were dribs and drabs,  A reasonable hourly wage full time (let’s say, as a postal carrier, which I almost got in 2004) would have added to the average of the top 35 a little. 

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