With their different income situations and longer life spans, women have a harder time figuring out how to use Social Security. To deal with these problems, two important sites give women useful information and tips on how to get the most out of their Social Security payments. Because these tools know how important customized methods are, they give women the important information they need to make sure they have enough money in retirement. As talks about Social Security continue to change, giving women the tools they need to make smart decisions about their money becomes more important than ever for long-term financial security.
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Learning the Basics
Sophia Duffy, JD, CPA, an assistant professor at the American College of Financial Services, says that women often have to deal with lower average Social Security benefits because they earn less over their career and marriage rates change over time, which affects their ability to get spouse and widow benefits. Duffy stresses how important it is for women to know about these things in order to make smart choices about their Social Security payments.
Why strategic claiming is important
Duffy laid out a number of suggestions for women:
You need to plan ahead, especially if you are a woman, to get the most out of your Social Security payments. Delaying claims until after full retirement age can make monthly payments a lot higher, which is great for people who have other ways to make money in retirement. Married women can get family benefits, even if they have never worked. It is best to claim the benefits of the lower-earning partner first. Widows can use widow benefits to get up to 100% of the benefits their late partner earned. Also, women who have been divorced for 10 years can start getting partner benefits at age 62, as long as their ex-spouse’s benefits are higher than their own and they haven’t gotten married again. These complex tactics show how important it is to make well-informed choices in order to get the most out of Social Security for women in a range of life situations.
Benefits for ex-spouses and other things women might want to think about when it comes to Social Security
As reported on the Merrill blog, Nevenka Vrdoljak, managing director at Bank of America Merrill Lynch, suggested some more plans:
Getting women the most out of their Social Security income depends on making smart decisions and working together. If you wait to start getting benefits until you turn 70, you may get a lot more money. For example, at age 67, your annual payments could go from $18,000 to $22,320. Claims coordination is very important for married couples, especially when their benefits are different. In this case, the partner who makes less money might start getting lowered retirement benefits early and then switch to spousal benefits later on. Smart tactics for women include having a deep understanding of spouse and widow benefits and thinking about what changes in marriage status mean. Both the Social Security Administration’s blog and Merrill Lynch stress how important it is to make a plan that is unique to your needs in order to be financially secure in retirement.
