Ideally, you'll enter retirement with some amount -- maybe even a large amount -- of money in savings. But will your nest egg be enough to sustain you?
Chances are, you'll end up at least somewhat reliant on Social Security once your career comes to an end. You may even end up depending heavily on your benefits to manage your expenses during your senior years. And so it's important to run through these questions before signing up to start collecting benefits.
1. What monthly benefit am I in line for?
The longer you delay Social Security (up until age 70, at least), the more your monthly benefit can grow. And so before you claim that benefit, you should figure out what it looks like.
Doing so is pretty easy. All you need to do is access your most recent Social Security earnings statement, because it contains an estimate of your benefit at full retirement age (FRA).
If you're 60 or older, you're entitled to get those earnings statements by mail every year. Otherwise, you can create an account on the Social Security Administration's website and access yours there.
If you take a look at your anticipated monthly benefit and aren't happy with the number you see, it may prompt you to keep working a few more years, especially if your income has peaked. Doing so could leave you with a higher benefit to look forward to.
2. What's my full retirement age?
You're entitled to your full monthly benefit based on your earnings history once you reach full retirement age. You can sign up at an earlier age -- as early as age 62 -- but claiming benefits before FRA will reduce them for life. And that's a hit you may not want to take. Or, it may be a hit you can't afford.
You can also delay your filing beyond FRA and boost your benefits by 8% a year up until your 70th birthday. That's a move you may want to consider if you aren't thrilled with the amount of savings you're bringing into retirement.
3. Will I be relying on a spousal benefit or a benefit of my own?
If you worked and earned enough credits in your lifetime, you should be in line for a monthly benefit from Social Security based on your wage history. But even if you never worked, you may still be entitled to benefits if you're married to someone who's eligible.
It's important to know whether you'll be claiming Social Security on your own work record, or whether you'll be claiming a spousal benefit. If you're going the latter route, you should know that there's no sense in delaying your filing past FRA, since spousal benefits can't grow. But if you're claiming a benefit based on your wage history, waiting beyond FRA could pay off.
Asking the right questions could lead you to a smart Social Security filing decision -- one that serves you well throughout your senior years. It pays to run through these specific points so you don't wind up taking benefits at the wrong time and regretting it later.