Can You Live Off of Your Social Security Check?

We frequently remind our readers that Social Security was intended to be supplementary income in retirement. It was never meant to fully fund your lifestyle! And yet, some people never do establish retirement savings, and find themselves living entirely off of their Social Security checks. Is this possible? And what would that type of retirement look like??

The average monthly benefit is $1,523. That’s a pretty tight budget, if you fall somewhere around the average. Of course, your actual Social Security benefits might be higher or lower than the average. But it’s worth asking yourself: Can I live off of $1500 a month?

Retiring later can help. Your full retirement age is either 66 or 67, depending upon when you were born. This is the age at which you can claim your full Social Security benefits. Avoid retiring earlier than this age, because your checks will be reduced (as much as 30 percent, if you retire at age 62). On the other hand, working until age 70 can boost your checks a little higher.?

Can you relocate to an area with a lower cost of living? In some areas of the country, living off of Social Security is inconceivable. But other areas do offer a much lower cost of living. Do your research, and don’t forget to factor taxes into the equation. But will a move mean leaving family and friends behind? How much will it cost to travel and visit them?

Are you single or married? If you’re single, consider living with at least one roommate. You can split expenses, and retiring with friends can be fun!

If you’re married, the two of you should consider what will happen when one of you passes away. Widows and widowers can claim survivor’s benefits, which is the larger of the two Social Security checks… but you’ll lose one check regardless.?

Are you debt free? Living on a fixed income is difficult for anyone, but particularly hard for those carrying significant debts. If you can pay off your mortgage, credit cards, and other debts before you retire, you stand a better chance of living within a more restricted budget.?

Consider your healthcare costs. For many retirees, healthcare costs exceed even the cost of housing. Evaluate all of your Medicare options and choose an insurance plan or plans that will most benefit your financial situation.?

The above points should give you an idea how you would live on Social Security alone. For most people, this plan is financially risky and does not provide for an adequate lifestyle. We strongly recommend that you contact us to discuss other options for funding your retirement, rather than counting on Social Security to cover everything.?