3 Things to Know About Social Security If You're Retiring in 2027
Written by Maurie Backman for The Motley Fool -> Social Security may play an important role in your retirement finances. Understanding the difference between different filing ages is key. It's also crucial to recognize how much replacement income Social Security will give you.
Social Security may play an important role in your retirement finances.
Understanding the difference between different filing ages is key.
It's also crucial to recognize how much replacement income Social Security will give you.
If you're planning to retire in 2027, you may be getting increasingly excited about wrapping up your career. At the same time, you may be getting increasingly anxious about the financial side of things.
After all, it's not easy to go from earning a steady paycheck to having to rely on a combination of savings and Social Security . It's important to understand the role those benefits might play in your retirement. With that in mind, here are three key things about Social Security that must be on your radar at this stage of the game.
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Retirees are often told to aim to replace 70% to 80% of their former income to live comfortably. You don't necessarily need to replace 100% of what you used to earn, since you won't have to save for retirement while you're in retirement. But that 70% to 80% range is a pretty good benchmark if you want to mostly uphold the standard of living you're used to.
Social Security, meanwhile, will replace about 40% of your pre-retirement wages if you earn an average salary. If you're a higher earner, though, those benefits might replace a smaller percentage of your former wages.
