What Women Need to Know About Social Security

You might imagine that the retirement planning process is about the same for everyone. But in reality, that’s not quite true. We all have unique circumstances (or hopes, or wishes), and our plans must accommodate those aspects of our visions for the future. Another major consideration is your gender. Retirement planning for women often requires some adjustments to account for certain differences throughout our careers.

These differences don’t apply to every woman, of course, but they are strong tendencies that we have witnessed in many cases. Women are more likely to take time off from their careers, whether to have children, care for an ill spouse or parent, or for some other reason. And of course, we know that based on national averages, women earn less overall. That leaves us at somewhat of a disadvantage with regard to retirement planning.

In particular, lower lifetime earnings affect your eventual Social Security benefits. Here’s what you need to know about Social Security, preferably far in advance of retirement so that you can prepare.

1.You become eligible for Social Security benefits (on your own work record) once you have accumulated 40 work credits. This translates into ten years of work and wages.

2. Your eventual monthly benefit amount will be calculated based on your 35 highest-earning years of employment. Unfortunately, that means you might have some zeros averaged into your formula, if you didn’t work a full 35 years. On the other hand, if you extend your career into your 60s, you might be able to make up for lost time.

3. You can claim Social Security benefits based upon your own work record, or upon your spouse’s work record (assuming you meet other requirements for spousal benefits).

4. If you are widowed or divorced, you can claim spousal benefits on your former spouse’s work record if the marriage lasted at least 10 years.

Of course, Social Security will only comprise part of your overall retirement income. For more information on how your benefits will be calculated, along with planning for another form of income, give us a call. We can help you learn what to expect and make a plan that suits your needs.