Tags: Retirement | retirement | Social Security | planning

Social Security Benefits and Your Retirement Planning

By    |   Tuesday, 16 June 2015 11:15 AM

When it comes to retirement planning, Social Security and its promised benefits can pose a dilemma: How to account for them without assuming they'll be there for you when you retire.

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People nearing retirement today look reasonably assured of receiving Social Security benefits, but reports projecting the Social Security trust fund will run dry have driven uncertainty, according to CBS MoneyWatch.

Nearly half of U.S. workers worry "a great deal" about Social Security, according to an April 2015 Gallup poll cited by CNBC.

That level of worry puts more pressure on a person's other sources of expected retirement income. At the same time, some say the presence of Social Security might dampen how aggressively workers invest for retirement.

Finance expert Steve Vernon, cites the Social Security Administration's discussion of "early retirement" in its literature on benefits.

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"In our society, the term 'early' has positive associations (the 'early bird gets the worm,' for example)." Vernon writes for CBS MoneyWatch. "If you start your Social Security benefits early, that could imply that you're successful and have figured out how to retire early. But the reality is that you're receiving a smaller retirement income if you start your benefits before age 70 or even age 66."

And for those receiving benefits, there are practical considerations, because the more you earn from multiple sources as a retiree, the more of your Social Security income the government will consider taxable.

The taxable portion of just your Social Security income "can go up to as much as 85 percent when your adjusted gross income exceeds $44,000 if you are married and file a joint return," WD Adkins writes for Demand Media.

Social Security, in short, has to be reckoned with by retirees, not just as a benefit but also as a bit of a wild card.

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When it comes to retirement planning, Social Security and its promised benefits can pose a dilemma: How to account for them without assuming they'll be there for you when you retire.
retirement, Social Security, planning
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2015-15-16
Tuesday, 16 June 2015 11:15 AM
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