Social Security Retirement Benefits

Last Updated: October 20, 2020

Written by the Open Caregiving Team. Editorial review by Joyce O. Murphy RN, MSN.

What are Social Security Retirement Benefits?

Social Security Retirement Benefits provide retirement income. They are for qualified adults after they reach a certain age, helping them to care for themselves and their family.

How do Social Security benefits work?

Most employees in the United States pay Social Security taxes on their income. The Social Security Administration then combines that money together and distributes it to Americans collecting Social Security benefits.

Some states’ employees pay into a pension fund instead of Social Security. They are not covered by Social Security Retirement Benefits for those earnings.

How do I know if I’m eligible for Social Security?

Americans become eligible to collect Social Security Benefits at age 62. Most able-bodied Americans need to have worked at least 10 years to be eligible for Social Security Retirement Benefits.

There are penalties for starting to take Social Security benefits before the “full retirement” age. Full retirement age is 66 for anyone born before 1955 and 67 years old for anyone born after 1960.

When should I collect Social Security?

Most people will financially benefit by waiting to collect Social Security Benefits until they reach full retirement age. Some people wait until age 70, resulting in more benefit per month. You don’t gain any more benefit by waiting past this age. This may not apply to people with disabilities.

Early retirement penalties:

The penalties for taking Social Security early can add up to receiving 30% fewer benefits overall. For more information on how taking early retirement benefits may affect your specific situation, continue reading on the SSA’s Benefit Reduction for Early Retirement page. If you take Social Security benefits before your full retirement age and you are also still working, you will have additional penalties.

Full retirement:

Once you reach full retirement age, you’ll receive your full amount of benefits. For more information on full retirement ages, visit the SSA’s retirement chart.

Delayed retirement:

You may get more social security benefits in the long run if you choose delayed retirement. Your benefits will increase each year you wait to claim benefits, until you are 70. You can calculate the percent increase using this SSA chart.

Working while receiving Social Security:

If you continue to work and collect Social Security benefits early, you will pay extra penalties. You will not face penalties for continuing to work and receiving Social Security benefits if you wait until full retirement. For more information on how working while collecting social security affects the amount you receive, review the SSA PDF on “How Work Affects Your Benefits”.

IMPORTANT: If you wait to collect Social Security you should still enroll in Medicare 3 months before your 65th birthday.

How much Social Security will I collect?

Social Security figures the amount of your payment based on how much you earned during your career. People with higher lifetime earnings receive higher benefits because they contributed more in social security taxes.

For a detailed breakdown on how much you may receive based on your individual earnings, create a government my Social Security Account and use the online benefits calculator.

How do I apply for social security benefits?

How long does it take for social security retirement benefits to be approved?

It takes about 6 weeks for your social security retirement benefits application to be approved and for your benefits to begin. This is if you provide all the correct information.

The approval time may take longer based on the number of applications being processed. It takes longer if you need to provide more information.

How is social security taxed?

If you have other income besides your social security benefits, you may have to pay federal income taxes on up to 85% of your Social Security benefits. If you do not have additional income besides your Social Security benefits, you most likely will not have to pay taxes on your Social Security benefits.When you draw on retirement benefits like a 401K, you may be partially taxed on your Social Security benefit.

To learn more about if you are required to pay taxes on Social security benefits review the SSA income tax rules.

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