Now that 2022 is underway, it’s time to brace for the Social Security changes we were warned about at the end of 2021. We understood change was coming, but what does that mean for our present situation?
Social Security is facing positive and negative change in 2022. For example, seniors are seeing benefit increases from raised earning limits and Cost of Living Adjustments (COLA); simultaneously, seniors looking to retire might have to adjust their plan as the full retirement age increases in 2022.
Tom Hager, for Forbes Magazine, gives us a brief rundown of the 2022 Social Security changes, spotlighting the age increase. The full retirement age is when seniors can claim their Social Security benefits without having any restrictions or funds withheld. This increase is in effect for everyone turning 62 this year. Because of this age increase, if seniors turning 62 in 2022 claim their benefits, they could see up to a 30 percent decrease; the full retirement age varies for people born between 1943 and 1960. For all seniors born after 1960, the full retirement age increases in 2022 to 67 years old.
How We React Matters
Claiming your benefits is a big decision, but luckily, we have strategies for this. Claiming your benefits at full retirement age or later bumps up your benefits, however, not everyone’s situation lets them wait to claim. If you need to claim before full retirement age, then you also have options. An alternative to claiming benefits is claiming spousal benefits and switching when you reach full age.
Additionally, you can earn and claim benefits at the same time; a career is a good way to hold off on claiming until full retirement, if your savings aren’t enough. If you’re under full retirement age, collecting benefits, and working, you can earn up to $19,560 with no penalty.
We are never without options; confirm with the Social Security Administration when you exactly reach full retirement age, so you plan with the right information. The Council for Retirement Security is working to ensure that every senior receives their benefits, regardless of when they decide to file. That way, seniors only have to worry about when to retire and not whether to retire at all.