Social Security can be complicated and, as a result, many individuals don’t have a full understanding of the choices they may have. Here are five facts about Social Security that are important to keep in mind:
1. Social Security is a Critical Source of Retirement Income
Some have the perception that Social Security is of secondary or even tertiary importance in retirement. But according to a report by the Social Security Administration, Social Security replaces about 40% of an average wage earner’s income after retiring.¹
Keep in mind that Social Security makes annual cost of living adjustments based on the Consumer Price Index and, under current laws, pays income for life and the life of your spouse.²
2. You Have a Choice for When You Take Social Security
You have considerable flexibility for when you can begin receiving your benefits.
As the accompanying illustration shows, the full retirement age, i.e., the age at which full retirement benefits are payable, depends upon when you were born.