Behind The Curtain: How They Calculate Social Security Benefits

A Step by Step Guide

It’s important for you to have a clear understanding of the process used to calculate your Social Security benefits.  Knowledge is power. If you understand this calculation, you may be able to spot mistakes and fix them before it’s too late.

calculate social security benefits

Like anything with Social Security, the rules can seem complex. Before I understood these rules, I struggled to understand how the Social Security Administration determined who would get what benefit amount.  But once I distilled the several pages of calculation rules, I realized that there are only four easy-to-understand steps.

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Who You Should Talk To At Your Local Social Security Office

Yes...It Makes A Big Difference

I help a lot of people with Social Security. One thing they all have in common is that they’ve called their local Social Security office at least once. Most of these calls have ended in frustration. It doesn’t have to be that way. If you know who to ask for, you’ll get the help you need.

Hierarchy at Social Security officeA decent part of my living comes from consulting with individuals throughout the nation with Social Security issues. For some, it’s simply determining how their filing strategy fits in with their overall retirement plan and making sure they haven’t missed anything. For others, I help solve complex Social Security problems. Many of these people that I help would never call me if they would have received a satisfactory answer and solid advice when they called their local Social Security office. So I may be hurting myself slightly, but I can’t stand to see any more bad (and sometimes non-reversible) decisions made as a result of incorrect guidance from the Social Security Administration. I’m going to tell you who to ask for the next time you call.

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Social Security Benefits for Grandchildren

In 2012 there were 2.7 million grandparents who had primary responsibility for a grandchild under the age of 18, according to a recent US Census Bureau report. Many of these grandparents don’t know that Social Security retirement benefits for dependent grandchildren is a real possibility.

Social Security Benefits for Grandchildren

Retirement doesn’t always go as expected. It hasn’t for the Causey’s. Instead of the frequent traveling they had always planned for their retirement, they are raising their young grandchildren. There’s no sense of burden though, they strongly believe it’s a privilege to have the mental, financial, and physical health that affords them the chance to offer security to their grandchildren. I admire their attitude! I hope that I would feel the same if I were placed in their situation.

Although the Causey’s had a well thought out retirement income plan, they’ve quickly discovered that the extra expense of raising kids will require them to increase their monthly cash flow. They were surprised when I advised them to file for Social Security benefits immediately. They had always planned to wait until full retirement age to file for benefits, but that all changed when they found out that by filing for their own benefits, they would turn on Social Security benefits to their dependent grandchildren as well.

It’s not one of the more well known benefits, but under the right conditions grandchildren (or step-grandchildren) can receive a benefit based on the work history of a grandparent.

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Retiring Overseas? Make Sure Your Social Security Benefit Will Follow

Ever dreamed of retiring overseas?

After a life spent in the States, maybe you’d prefer the cultural heritage of Latin America, the sand of the Caribbean or the ancient beauty of Europe. Before you pack your bags, make sure your selected destination is one of the countries where you can still receive your Social Security benefit.

Want to retire overseas? Make sure Social Security will follow

The rules are incredibly complex for those who are eligible for Social Security benefits, but are outside of the United States.  These rules apply not only to those who plan to move, but could apply to someone who was on a missions trip or extended vacation.

For the purposes of this article, we’ll limit our discussion to US citizens who have lived and worked in the United States and decided to retire overseas (or extensively travel) during their retirement years.

The Social Security Administration makes it clear.  If you are a US citizen, you can receive your Social Security benefits if you are outside of the United States.  As you may suspect, there are some stipulations.

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