Hello everyone! Welcome to this new video where we're going to talk about a super important topic: changes in the retirement age and Social Security benefits. If you're planning your retirement or just want to be prepared for the future, stay until the end because I'm going to tell you EVERYTHING you need to know.
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Okay, let's get right to it. We've all heard that 65 is the magic age to retire and receive 100% of your benefits, right? Well... that hasn't been the case for years. Now, your full retirement age depends on your year of birth. Let me explain how this works.
If you were born before 1938, you could retire at 65 without any problem. But for those of us born after that date, things are different:
- If you were born between 1943 and 1954, your full retirement age is 66.
- If you were born in 1958, that's 66 years and 8 months.
- For those born in 1960 or later, they must wait until age 67 to receive 100% of their benefits.
Yes, folks, the retirement age is increasing, and this has to do with the fact that we are living longer and, well, the Social Security system is facing some economic challenges.
But wait, why is this happening?
It all has to do with increasing life expectancy. Nowadays, people live many more years after retirement, which means that the system has to pay benefits for longer.
The program also has a financial problem: there are fewer young workers contributing to Social Security and more people retiring. This is throwing the accounts out of balance and that is why they are adjusting the retirement age.
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Now, a lot of people ask me, "What if I want to retire before my full retirement age?"
The answer is yes, you can, but there is a cost.
If you decide to retire at age 62, which is the minimum age, your benefits will be permanently reduced. For example:
- If your full benefit is $2,000 per month, you could receive only $1,400 per month if you retire early.
- This is a reduction of 30% on average.
On the other hand, if you decide to wait beyond your retirement age, you could receive a larger benefit! For every year you wait, your payments will increase by 8% until age 70.
I'll put it in numbers:
- If you receive a $2,000 per month benefit at age 67, but decide to wait until age 70, you could receive up to $2,480 per month. That's 25% more. So if you can wait, it could be worth it.
Now let's talk about what's happening with Social Security and what to expect in the coming years, especially in 2025.
1. Financial uncertainty:
Without significant changes, experts say the Social Security trust fund could begin to run out in the 2030s.
2. Reduction of future benefits:
If the fund is partially depleted, the program will only be able to pay 77% of the promised benefits. This does not immediately affect those who are already retired, but it does affect future beneficiaries.
3. Retirement age adjustments:
While nothing is confirmed, some lawmakers have proposed raising the full retirement age even further for younger generations, so this is something to keep an eye on.
What can you do to prepare for all these changes? Here are some practical tips:
1. Check your account statement:
Log in to your account on the official Social Security website and make sure your income is reported correctly.
2. Plan ahead:
If you're thinking about retirement, consider whether it's better to retire early with less money or wait to maximize your benefits.
3. Consult with a financial advisor:
An expert can help you make strategic decisions about your savings and retirement plan.
4. Stay informed and updated:
Subscribe to our channel to stay up to date with any changes to Social Security policies.
Friends, retirement is one of the most important decisions we will make in our lives. With these changes in Social Security, the key is to be informed and plan ahead.
Tell me in the comments:
- Are you ready for these changes?
- Do you plan to retire early, late, or right at your full retirement age?
If you have any questions, leave them below and I will try to answer them in the next video. Don't forget to give this video a thumbs up, share it with someone who needs this information, and subscribe to the channel for more content like this.
Thanks for joining me and see you in the next video!
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