By financen | January 14, 2009 - 6:02 pm - Posted in Others

When you are getting close to the retirement age, deciding when to sign up for the social security benefit can be quite a serious decision. Social security is the largest source of income for the retired persons. Depending on the age you start receiving the payments on your social security, it can vastly affect the amount of money you receive over your lifetime.

There are certain unusual but allowable strategies that the retirees can ponder before they sign up for their due. The common highlights are:

Borrow and invest money: Sign up for the social security as early as possible so that you can receive more benefits out of it. If you sign up for social security benefits at the age of 62, you will be receiving reduced benefits for the rest of your life, unless you can afford to pay the money back. You may qualify for higher payments of your life if you are able to return every cent you have already received, without interests. A person who is living on social security benefits can do the maximum investment, keep the earnings and then pay back the loan from Uncle Sam.

Claim now, claim more later: If you are working and your spouse is already retired, then you can ask your spouse to claim for a spousal benefit at full retirement age. When you are getting close to the full retirement age or wish to continue working for longer period, you will also claim for your benefits. This approach will allow you to receive spousal benefits while you are still working after the full retirement age and multiply the amount when you are getting social security checks later.

Claim and suspend: A spousal benefit is generally equal to half of the higher earner’s due, although claiming it before full retirement age diminishes the amount of the benefit. A wife can claim for a spousal benefit only after her husband signs up for social security, and vice versa, if a husband wants to collect based on his wife’s record. You can claim your social security benefits and then suspend the payments. This will help your spouse to receive checks when s/he is not earning enough to qualify for the benefits. During this time, the other spouse can continue to work longer to get higher social security payouts later.

All these strategies can decide how much you will be able to earn from your social security benefits until death. Waiting to sign up for Social Security can help ensure you against outliving your savings, but delaying is never a good idea if you’re in poor health or otherwise think you won’t live a long life.

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