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Social Security: How Much Will You Get?

Have you ever thought about how much you will get for Social Security? Have you done the research and found out that there are way more choices to make than you originally thought?


If you're single, you have to consider how much you've contributed, your life expectancy, and how much you want to protect yourself from living too long. If you're married, in addition to these you have to consider the relative ages of you and your spouse as well as the relative income differential of you and your spouse. 


How do you make sense of it all?



What Is Social Security?


Social Security is a government system and provides income to people in retirement (also disabled people, but that's a different topic). For retired people, they get a check based on their lifetime earnings, and the amount of this money grows with inflation. They call this a cost-of-living-adjustment, or COLA. You get Social Security retirement benefits until you die.


In addition to getting benefits for retirement based on your earnings, benefits are paid to survivors if someone passes away who was eligible for benefits. These are called survivor benefits. 


Social Security Is Not An Investment


I want to make sure people understand Social Security is not an investment; it's a tax. There aren't many situations where our taxes and the government expenditures are so closely related, and that gives it the feeling of being an investment, but our taxes pay current benefits. There is no account in our names and we aren't owed anything, technically. Further, Social Security was never intended to be anyone's sole source of retirement income. 


Even so, Social Security acts more like an annuity than an investment, and annuities are insurance products. 


When Can You Claim?


You can get benefits when you hit your full retirement age, or FRA. This has going up depending on when you were born. The Social Security Administration has a table that s