Social Security Benefits - Understanding your Benefits

A couple Sitting at a Kitchen Table.A couple Sitting at a Kitchen Table.By: Rhoda Baer

For those planning their retirement, they should be aware of important factors that come into play when determining eligibility, and the amount of benefits received. 

Retirement Estimator

Using the Retirement Estimator, can help you get a “ball-park” idea of the benefit amount you could receive. (You can still use the estimator if you are only receiving Medicare benefits.)

Who Can Use It?

  • If you have enough Social Security credits at the time to qualify for benefits.  
  • You are not receiving currently receiving Social Security Benefits, or waiting on a decision about your application for benefits or medicare. 
  • Age 62 or older, receiving benefits on another person’s Social Security record, or eligible for a pension based on work not covered by Social Security. 
  • If you can’t use the estimator for reasons such as wanting to a survivors, or disability benefit estimate, you can use Social Security’s other benefit calculators

What Age Should You Apply?

Deciding to receive your benefits after the normal retirement age may actually result in larger benefits. Going the delayed retirement route, may result in getting the largest benefit if you were to retire by the age of 70 instead of 62. 

Early, Full Vs Delayed Retirement Age

If you decide to retire early, a benefit is reduced 5/9 of one percent for each month before normal retirement age, up to 36 months. If for instance the number of months exceeds 36, your benefits are further reduced to 5.12 of one percent per month. 

Delayed Retirement Credit

This type of credit is given to those who decide to retire after the normal retirement age. In order to receive full credit, you must be insured at your normal retirement age, no credit is given after 69.

If you decide to retire before the age of 70, some of your delayed credits will not be applied until the following January from the date you begin receiving your benefits. 


(Here is a table that shows you the delayed retirement credit by year of birth)

Delayed retirement credit

Year of birthCredit per year
1943 and later8.0%

Note: Persons born on January 1 of any year should refer to the credit percentage for the previous year.


Benefits Calculator

Your benefits can be calculated by simply going to Social Security’s benefit calculator. There you will find out the effect of early or delayed retirement as a percentage of your primary insurance amount by entering your birthday and the effective month you wish to begin receiving your benefits.  

Approval Process

Once Social Security received your application, they will mail you a letter letting you know they received it. You can check the status for Social Security, Supplemental Security benefits, pending reconsiderations or hearing requests by creating or logging into your my Social Security. Wait times can vary based on if the Social Security Administration needs further information. 

When Benefits Start And Payment Dates

Once approved, receiving your benefits depends on your date of birth. If you applied for Social Security benefits before April 30, 1997, or if you receive both Social Security and Supplemental Security Income, you will receive your benefit on the third of the month. If you only receive SSI, you will receive your benefit on the first of the month. If you applied for SS benefits after April 30th, 1997, the date of birth of the person you receive benefits under determines your payment date. Below you’ll find payment dates for both 2019 and 2020. 

Schedule Of Social Security Benefit Payments - Calendar 2019 

Schedule Of Social Security Benefit Payments - Calendar 2020

Date of BirthPayment Day
1st through 10thSecond Wednesday
11th through 20thThird Wednesday
21st through 31stFourth Wednesday

Getting Benefits While Working

You can still receive Social Security retirement benefits and work at the same time. It all depends on your age. If you are younger than full retirement age, and make more than the yearly earnings limit. Once you reach full retirement age, that very month Social Security will no longer reduce your benefits no matter how much you earn.  

For 2019, the yearly earnings limit is $17,640. 

If you are under full retirement age, for the entire year, Social Security deducts $1 for every $2 you earn above the annual limit. 

In the year that you reach full retirement age, $1 is deducted for every $3 you earn above a different limit, but earnings are only counted before the month you reach full retirement age.

You can use the Retirement Age Calculator to figure out your full retirement age, based on your date of birth. Then you can use the Retirement Earnings Test Calculator to figure out how much will be reduced from your benefits if you decide to receive benefits before full retirement age. 

One thing to remember is as you continue to work, you continue to pay Social Security taxes on your earnings. Therefore, your benefits may increase while you work, even if you are receiving benefits. Your record will be checked every year to determine whether the additional earnings will increase your monthly benefit or not. If you do get an increase, a letter will be sent informing you of such.

If you are under full retirement age, and think that your earnings will be different than what you originally indicated to Social Security. You will have to call them directly at 1-800-772-1213 (TTY 1-800-325-0778) between 7 a.m. to 7 p.m., Monday through Friday, or contact your local Social Security office.    

Paying Taxes on Benefits

When it comes to paying taxes on Social Security benefits, some people may have to pay federal income taxes. However, no one pays taxes on more than 85% of their Social Security benefits. Those who have to pay taxes on their benefits are those who have filed a federal tax return as “individual” and their “combined income” exceeds $25,000. If you file a joint return, you may have to pay taxes on up to 50 percent of your benefits if you and your spouse’s combined income falls between $32,000 and $44,000. If it exceeds $44,000, it may be up to 85 percent. If you are married and decide to file a separate return, you will more than likely have to pay taxes on your benefits. 

Your adjusted gross income:

+ Nontaxable interest

+ ½ of your Social Security benefits

= Your "combined income"

You will receive a Social Security Benefit Statement every January, which will show the amount of benefits you received in the previous year. You can use this statement when you complete your federal income tax return to find out if your benefits will be taxed. 

If you do have to pay taxes on your Social Security benefits, you can make quarterly estimated payments to the IRS or you can choose to have federal taxes withheld from your benefits. 

Other Social Security Benefit Guides

Benefit Guide About
Spousal BenefitsGuide on spousal social security benefits
Survivor BenefitsWhat happens when a family member dies
Social Security ApplicationHelp applying for social security
Disability SSI\SSDIIncome benefits for those with disabilities
Social Security AccountTips & advice with your social security account
Social Security CardsGet a new card or replace a lost or stolen one
Social Security BenefitsRead the GuideThe current article you are reading
Government Benefits GuidesLists of most common government benefits, requirements to qualify and how to apply