Senior Living



Social Security and You: Social Security 101

Tom Margenau on

Sometimes this column can get into some complicated or esoteric Social Security rules or circumstances. But it dawned on me that many of the emails I get from readers are asking questions about some pretty basic Social Security stuff. So this week's column will be like a refresher course in Social Security. I will just go over the basic rules for various kinds of Social Security benefits.

But I will only scratch the surface of these basic rules. For more information, you'll need to read my little Social Security guidebook. Instructions for getting that book are at the end of this column.

Retirement Benefits

To get Social Security retirement benefits, you must be "insured," and you must be at least 62 years old. Being insured means you have a minimum of 40 credits (sometimes called "quarters"). Because you can only earn four credits per year, that means you must have worked and paid Social Security taxes for 10 or more years to qualify for benefits.

You get your full retirement benefit if you wait until your full retirement age to apply for those benefits. Benefits are reduced by roughly one half of one percent for each month they are taken before FRA. If you take benefits at 62, you will get somewhere between 70% and 75% of your full benefit, depending on what your full retirement age is. (If you're not sure what your FRA is, you'll find a chart in my book.)

If you delay taking benefits beyond your FRA, you will get a two-thirds of one percent increase in your eventual retirement rate for each month you delay taking those benefits. But those DRCs stop getting paid once you turn 70.


If you are over your FRA, you can work and make as much money as you want and still be due all your benefits. But if you start your benefits before your FRA, you will lose one dollar in benefits for every two dollars you earn over $18,960. Only earnings from a job count towards the earnings penalty limits, not savings or investment income. There is a more lenient income threshold ($50,520) beginning in January of your FRA year up until the month before the month you reach your FRA.

Disability Benefits

To qualify for Social Security disability benefits, you must be "insured," and you must have a physical or mental impairment that is so severe it will keep you from working for at least 12 months. For most people, being insured means having at least 40 work credits. But some of those credits must be earned recently. The general rule is that you need to have worked and paid Social Security taxes in five out of the last 10 years.

When you file for disability benefits, you must provide contact information for anyone who has treated you for your condition. Those doctors, hospitals, etc., will have to provide SSA with your medical records so that a decision can be made about your eligibility for benefits.


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