Social Security benefits can seem like a guarantee—something you’ve earned and can count on in retirement. But there are actually a few ways you could lose your Social Security benefits or have them reduced. To avoid any unpleasant surprises, it’s important to understand how your benefits could be affected.
How You Could Lose Social Security Benefits
According to Yahoo! News, there are four primary ways you could lose your Social Security benefits:
1. Claiming Too Early
You can claim Social Security benefits as early as age 62, but doing so comes with a permanent reduction in benefits. You’ll receive just 70% of your benefits if you claim at 62. The best time to claim is your full retirement age, which is 66 or 67 for most people. By waiting to claim until then, you’ll receive 100% of your benefits.
2. Jail Time
You might not think that time behind bars would have an effect on your Social Security benefits, but it can. If you’re convicted of a crime and sent to prison, your benefits will be suspended. The Social Security Administration notes that your benefits can be reinstated once you’re released from prison, but you’ll have to reapply for them.
3. Taxes
While you might not think of taxes as a way to lose your benefits, they can actually have a significant impact. If your benefits are taxable, that means the government can claim up to 85% of your benefits. As a result, you could end up with very little money from Social Security.
4. Losing Disability Benefits
If you’re receiving Social Security disability benefits, it’s important to remember that those benefits are not permanent. The Social Security Administration will periodically review your case to see if you still meet the eligibility requirements for disability benefits. If your condition has improved to the point where you’re no longer considered disabled, your benefits could be terminated.
The Seniors Center
Keep in mind that these are just a few of the ways you could lose your Social Security benefits. For more information, be sure to speak with a qualified financial professional.
The Seniors Center is here to help retirees navigate their benefits and plan for a comfortable retirement. Be sure to follow us on Twitter and Facebook for more updates!
