Social Security Mistakes That Put Your Retirement Fund At Risk

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Navigating Social Security can be complex, and missteps can significantly impact your retirement finances. Retiring is for relaxing, and your retirement fund will be the cushion keeping you cozy — the last thing we want is to that to be damaged by simple mistakes made from Social Security innexperience. To ensure you maximize your benefits and safeguard your retirement fund, it’s crucial to avoid these common Social Security mistakes.

Claiming Benefits Too Early

Claiming Social Security before your full retirement age (FRA) can permanently reduce your monthly benefits. This reduction can significantly impact your long-term financial security in retirement.

Ignoring Spousal Benefits

Spouses and ex-spouses (in certain cases) are often eligible for benefits based on their partner’s work record. Not exploring this option can lead to missing out on higher benefits.

Not Understanding the Tax Implications

Up to 85% of your Social Security benefits can be taxable, depending on your income level. Failing to account for this in your retirement plan can lead to financial surprises.

Working While Receiving Benefits Too Early

If you claim Social Security before reaching FRA and continue to work, your benefits might be temporarily reduced based on your earnings.

Lack of Proper Planning

Not incorporating Social Security into your broader retirement plan can lead to suboptimal claiming strategies, potentially reducing lifetime benefits.

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Ignoring Inflation and Cost of Living Adjustments (COLAs)

Failing to consider the impact of inflation and the role of COLAs can result in underestimating your financial needs in later retirement years.

Overlooking Survivor Benefits

Widows, widowers, and dependent children may be eligible for survivor benefits. Not understanding or claiming these benefits can lead to financial strain for surviving family members.

Assuming Social Security Is Enough

Relying solely on Social Security for retirement income can be risky. It’s important to have additional savings or income streams.

Not Checking Your Earnings Record

Regularly review your Social Security earnings record for accuracy. Errors or omissions can affect the amount of your future benefits.

Delaying Beyond Age 70

Benefits do not increase after age 70, so delaying past this age means missing out on payments without gaining any additional benefit.

Avoiding these mistakes is crucial for maximizing your Social Security benefits and ensuring a more financially secure retirement. It’s advisable to consult with a financial advisor or a Social Security expert to make well-informed decisions tailored to your individual retirement goals and circumstances.

Editor's note: This article was produced via automated technology and then fine-tuned and verified for accuracy by a member of GOBankingRates' editorial team.

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