Social Security: Key Points for Your Financial Future
Social Security can often seem confusing and complicated. At Johnson Brunetti, we aim to simplify this essential part of your financial planning. Joel Johnson, CFP® joins Retire Wiser with NBC Connecticut to share the three crucial aspects of Social Security that everyone should be aware of.
Understanding Social Security as a Financial Asset
Firstly, it’s important to view Social Security as a significant financial asset. Imagine it as a substantial account, potentially worth $400,000 to $500,000. Treating it as an important account rather than merely a stream of payments can significantly impact your approach to retirement planning.
The first key point is understanding the requirement of 40 credits for eligibility. To qualify for Social Security, you need 40 quarters of income, which amounts to 10 years. It’s crucial to ensure you’ve accumulated these credits to secure your benefits.
The Impact of Age on Your Benefits
Next, consider how your age influences your benefits. Many people know that delaying benefits can result in higher monthly payments. This increase is because the calculation considers your age, as it relates to your life expectancy. However, it’s vital to make informed decisions about when to begin receiving benefits, balancing the advantages of larger payments with your financial needs.
Taxation of Social Security Benefits
Lastly, a common misconception is that Social Security benefits are not taxed. This is not true for most people, particularly in regions like the Northeast, where additional income sources are often necessary for a comfortable retirement. Therefore, some of your Social Security benefits may be taxed. Understanding this and exploring strategies to minimize these taxes is essential.
Information presented in our podcasts is considered current as of the created date. Over time, some information presented may become stale. We recommend you consult with your Financial Professional before making any changes based on information contained here.
Johnson Brunetti is a marketing name for the businesses of JB Capital and JN Financial.
Investment Advisory Services offered through JB Capital, LLC. Insurance Products offered through JN Financial, LLC.
The guarantees provided by any type of insurance contract are based on the claims-paying ability of the insurance company.
Related Resources
-
Preparing for Retirement? Have a Plan for Taxes
Effective tax planning requires a proactive approach for today’s pre-retirees, as neglecting this crucial step can result in a significant tax bill later on. To help minimize your overall tax burd… -
Answers to Key Social Security Questions
The decisions you make about Social Security can have lasting implications, which is why it’s important to get your questions answered sooner rather than later. If you’re unsure about how to maxim… -
The Right Order to Build Your Financial House
You wouldn’t design a house that leaves you exposed to outside elements, so why do the same when building your financial house? A well-constructed house first and foremost needs a strong foundatio… -
Identity Theft: What to Do If Your Identity Is Stolen
In the digital age, the threat of identity theft is at an all-time high. Sophisticated cybercrime tactics and schemes have left us more vulnerable to online scams than ever before. So, what can… -
Don’t Let Taxes Derail Your Financial Plan
A retirement plan that doesn’t consider the impact of taxes can only get you so far. Implementing tax-efficient strategies early on is critical to lowering your lifetime tax liability. After all, … -
Estate Planning Must Haves
Estate planning can be a time-consuming and overwhelming process, but it’s a crucial step in securing your family’s financial future and cementing your legacy. By working closely with an estate pl… -
The Road to Retirement – Don’t Go it Alone
Achieving the retirement you’ve always dreamed of often requires careful planning. While the do-it-yourself approach may be difficult to shake, consider the benefits of seeking professional advice… -
Am I Carrying Too Much Debt in Retirement?
At any stage in life, debt can interfere with your financial goals. But what about when you retire? How much debt is too much? It depends on a variety of factors, including your income relative to… -
What Updates Can We Expect for Social Security in 2025?
A new year means new rules for retirement plans. Let’s start with one of the largest sources of income for millions of retirees: Social Security. What changes can we expect in 2025? Heath Gross… -
Getting It All Together for Retirement
After a long, fulfilling career, the time has come to embrace the next chapter. You may have envisioned the age at which you’d retire since you began working, but it’s important to distinguish bet…
