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Preparing for retirement is both a long race against time and the patience of each worker.
It's not just about planning what you will do with your time once the time comes to stop working, but also about preparing yourself to know how to make ends meet, and above all, taking into the benefits of Social Security, especially if your salary has not kept up with the years.
If you currently earn $25,000 a year, you may be particularly curious to know exactly how much you are entitled to from Social Security.
To qualify for retirement benefits, you need up to 40 credits, which is equivalent to 10 years of work, according to the Social Security istration (SSA).
Retirees receive a credit for every $1,730 of income, with a limit of four credits per year, giving them $1,976 per month in Social Security benefits starting in 2025.
Retirement plans according to Social Security
If you earn $25,000 a year, it's time to get out the calculator to find out how much you get from Social Security benefits.
The United States spends trillions of dollars on Social Security each year to ensure that beneficiaries receive their fair share of benefits.
Despite changes to the Social Security system this year, Americans who have contributed to the program throughout their careers can project what their retirement income will look like using the SSA's quick calculator.
For example, suppose you turn 62 this year, the earliest age to start receiving benefits, and plan to retire at the end of 2025. In this case, you earn a steady $25,000 a year in salary and have done so for some time.
The SSA can analyze the figures to show that the estimated amount of your monthly benefit would be $822.00, without considering future income or price increases.
If you're not satisfied with this amount, don't worry, there are many steps you can take to ensure your finances are in order for retirement.
By today's standards, a net annual income of $25,000 is not a lot of money. Still, living paycheck to paycheck offers opportunities to save, which is critical in retirement, but not the only solution to make ends meet.
If you're concerned that your Social Security benefits won't cover your living expenses, you might consider postponing retirement and working a few more years, or consult with a financial advisor to calculate how much you should really save for retirement through employer-provided retirement plans, such as a 401(k), or tax-advantaged investment s, such as Roth IRAs.
You can also start looking into how to downsize your lifestyle, including selling your home, cutting back on luxuries and sticking to a budget that covers your needs, but at the same time allows you some flexibility to do what you want during your retirement.