Everybody has a social security number nine digits long, individual to yourself. They even identify you by that social security number, at least your last four digits. Do you know there are some other numbers that are essential to know before you start making social security withdrawal decisions? We’re going to talk about those on today’s show.

The first number you need to know when it comes to social security, when it comes to deciding when to draw, is your full retirement age FRA. Now you can draw at 62. That’s when you can initially start drawing. You’re going to take about a 25% haircut. You can draw as late as 70 and you can wait, but there’s no reason to wait because they’re not going to save it up for you and  it’s not going to get that much better.

You need to take it by the time you’re 70, but what about in the middle here, your full retirement age? Well, it’s different for different people. My grandfather was born in 1898. His full retirement age was 65. I was born in 1952, and if you were born from 1954 or earlier, your full retirement age is 66 now, my wife was born in 1960. If you were born in 1960 or this side of 1960, your full retirement age is 67. What about those in the middle? If you were born in 1955 at 66 years and two months, 1956, it’s 66 years and four months. Born in 1957, no problem, 66 years and six months. Born in 1958, 66 and eight months, and if you were born in 1959, it’s 66 years and 10 months. It’s really important that you know your full retirement age. We’ll talk a little bit more about that later and why.

Remember, you can turn on your social security anytime after you reach age 62. Make sure and listen to the rest of the show because I’m going to give you some reasons why you might not want to, but at least when you get to 70, go ahead and turn it on. Sometimes people say, well, I don’t know if I want to pay the taxes. Well, I do because you’re always going to get more money than they’re going to charge you back in taxes, so turn it on at 70. Doesn’t get any better than that. You need to get the income flow starting at least when you turn 70, even if you’re still working. Now, another big number, 40, 40 quarters, quarters of a year, and it’s really not a quarter of a year. Actually, what you have to make now is you have to make about $2,000 in a year, anytime during that year, and you’ll qualify for all four quarters of that year, so you have to have 40 quarters.

Some people ask, why don’t they just call it 10 years? I don’t know. I can’t explain why they do it, but they’ve always called it 40 quarters. How do you find that out? You can go to a website www.ssa.gov, that stands for social security administration.gov, not .com, .net,  Go to www.ssa.gov. Fight through all the security to get your account set up and in the very front of what they show you when it comes to your report, they’re going to say, you have worked 40 quarters or you have not completed your 40 quarters. You need to continue to work two more years or 10 more quarters, or they’ll tell you how much you are short. This is particularly important with those of you that we work with where maybe you weren’t born in this country or maybe you have only worked a very short period of time, but if you weren’t born in this country and you didn’t work full time once you got here and you’ve worked a limited amount in the United States, you need to find out how it’s going to impact your social security. It’s going to impact your eligibility for Medicare. You need to find out, have you worked 40 quarters?

Next big number 35. You say, where’s 35? I’ve never heard of that. A lot of people haven’t. When they go calculate your payout, they take your top 35 earning years. You say, “Tom, I don’t know if I’ve worked all that many years. What if I’ve only had 30 years where I’ve earned income and paid into social security?” They’re still going to take your top 35. What does that mean? They’re going to give you all of your 30 years, the numbers that you earned during those years, and they’re going to give you five zeros. Sometimes people may decide once they get on and find out how many years they’ve paid in, whoa, I’m short five years, they may decide to work another five years.

Again, you only have to earn about $2,000 a year to qualify for all four quarters. So sometimes people get a part-time job just to continue to take those zeros off the board and put a number in there and increase their social security. So the old saying, what you don’t know can’t hurt you. That’s so wrong, especially when it comes to social security. You need to know if you’ve paid in 35 years or not. It may persuade you to work a little more. So who might be eligible for that? Hey, men, women, did you start a job and maybe not earn anything as you were doing the startup, getting that business off the ground? And so for years you might not have paid any income tax because you were actually pouring money into your company, not drawing any money out. I’ve got one client who in for seven years, zeroes for seven years, and he got to Social Security and realized he only had 32 years paid in because of that.

You need to know, ladies, did you take time off in your twenties and thirties to raise your children to get them to school age or even passed the start of school age where you did not have an outside the home job? Don’t ever say you didn’t work because when you’re at home raising children, you’re definitely working, but did you not work in a way that you paid in social security? So that might impact the next big number. We’re talking about 35, have you paid in 35 years?

And the last one I want to talk about for today is $23,400. You say, ”Wow, I like that one because we went from 40 to 35 and now we’re at $23,400.” Here’s what I mean by $23,400. If you decide to start taking your social security between the time you’re 62 and your full retirement age, hey, if you listen to the first of this show, you should know your full retirement age, but from 62 until the year you reach full retirement age.

Here’s the rule. You can only earn $23,400 that year. Otherwise every $2 over $23,400, you pay back a dollar of Social security. So you could be making a hundred thousand dollars a year and say, well, I want to turn on my social security at 62. They’re saying they might not pay it out forever, so I want to be prepared. Guess what? You could be turning it on and then at the end of the year paying it all back. So know the rules and the rules are crazy and the rules aren’t normal and they’re not intuitive. They, they’re almost counterintuitive. So know the rules, work with somebody who knows the rules because if you’re earning income from 62 until your full retirement age, the max you can make is $23,400. Just to throw you one more curve ball in that last year, when you turn full retirement age, you can only make $62,160 or for every $3 over that, you pay back a dollar of social security before you turn on social and you still got that big job.

You better be careful. You may be paying it all back. So to wrap this up, know your numbers. Just like you probably know your social security number, know your full retirement age. Know for sure if you’ve worked 40 quarters to qualify for Medicare and Social security. Know for sure how many of the 35 years that they’re going to count toward your earnings history that you’ve paid in. Is it 30? Maybe work a little more. If you’re over 35 every year that you make more, it takes off the lower score, so know if you’ve paid in 35 or not and know if you turn on your social at 62 to 67, that $23,400 is the max. You can make you say, wow, there’s so many things that are so confusing. Let me give you one more number. It’s ours.

(855)567-0933.

We are here. Every one of our advisors is trained by the National Social Security Advisors administration and they take a proctored exam after passing a 20 module course and they know what they need to know about social security to help you. And the other number is this number, this phone number. Call our phone number. Set up a time. We’ll be glad to help you. Hey, this is Tom Mosley. I promise you every week, if you’ll give me a few minutes, I’ll do my best to increase your financial knowledge and if we can help you particularly about a situation, a question, anything, give us a call. We’ll see you next time.