Without a doubt, it is essential to think about our long-term financial future if we have a safety net when we live on a fixed income and we have social security. Official figures ensure that about 90% of retired Americans have financial support that comes from Social Security benefits.
Calculating exactly how much you would get for your retirement, from the moment you start saving, can be confusing and even complicated, but it is worth doing if we think that at some point you will have to leave your work life And, therefore, the question will arise of how you can keep calm if you do not have enough income.
It is estimated that about 9 out of 10 people over 65, receive Social Security benefits, making it an essential part of retirement in the United States according to CNBC. Benefits are based on your income, the year you were born, and the age you decided to start saving. This situation is essential to determine what your future can be like.
In case you have a traditional job, for example, through which you earn at least $ 35,000 per year, you will pay 6.2% of your income, that is, $ 2,170 per year in Social Security taxes, that figure is matched by your employer and those figures are straightforward.
Deciphering how much you will get back when you are determined to get paid is a different matter. But it is important to think that you are turning 62 in 2021, and your average living wage was $ 35,000 adjusted for inflation., what Social Security will do is take your highest 35 years of income, adjusted for inflation, add them and divide them by 420, that is, the number of months in 35 years.
The above, results in the amount of $ 2,917 dollars, this figure is the average of the monthly indexed earnings (AIME, for its acronym in English). It is essential that you take into account that your profits are determined by flex points in an equation. It is like a tax category but designed to give you money.
The less money you have earned, the higher the percentage you will get back from your salary. This was made for help low-income retirees. Here’s how your flex points would work based on your average monthly index earnings we calculated earlier; You would get 90% of your salary, of your first $ 996 dollars, that means almost $ 900 dollars, that is, $ 896 dollars.
The next flex point is more complicated, you will get 32% of the remaining profit, which results in the amount of $ 615 dollars, therefore, based on this salary, you can expect a figure of more than $ 1,500 a month if you wait to reach your retirement age. These numbers are subject to variation, but they can provide a bigger picture of what to expect when it’s time to retire.
In case you have doubts about how you are contributing for retirement, it is necessary that you contact Social Security so that you have a clarity of everything. If not, you can also turn to pension experts, who can tell you how you can improve your benefits.
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