If you have not considered your needs for retirement because you are relying on Social Security benefits to cover your cost of living, you may have some misconceptions about the function of Social Security. Below is a closer look at what you need to know about Social Security to help you steer clear of common mistakes in retirement planning.
Myth: Social Security will provide enough income for a comfortable retirement
Social Security benefits have never been intended to substitute retirement income from private savings and investments. It is instead supposed to serve as supplemental income to cover any gaps that may exist in your retirement funding. Therefore, you should plan your retirement independently of your expected Social Security benefits—especially if you are not part of the baby boomer generation.
Myth: Your retirement income will affect your Social Security benefits
Many people think that working or earning income during retirement will have an impact on Social Security benefits, but this is only true if you are not of full retirement age. Any person born after 1960 has a full retirement age of 67, at which point you can earn as much as you want without any effect on your benefits. However, you should note that you may have to pay taxes on Social Security income if you do have other sources of income.
Myth: Social Security only covers retirement benefits
The Social Security program is not just for retirees. It also provides benefits to disabled individuals and certain family members of deceased individuals.
To fully understand the limits of Social Security and the role of these benefits in your retirement, connect with Upstream Investment Partners in Lisle, IL. Call 630-599-7115 for a complimentary consultation to start planning for your retirement with solutions tuned to your unique needs.
Upstream Investment Partners is independently owned and operated. Securities offered through Sigma Financial Corporation, Member FINRA/SIPC. Investment Advisory Services offered through Sigma Planning Corporation, a Registered Investment Advisor.
Upstream Investment partners is located at 2443 Warrenville Road Suite 115, Lisle, IL 60532.