Retirement signals the beginning of your second life, which requires proper planning for the type of lifestyle you need to take. This is because even if you stopped working, the government still wants you to pay your tax dues. Thus, it will depend on where you live, the income you are going to receive, and how much.
Social Security Tax
In many states in the U.S., Social Security benefits are not subject to tax. However, it is still included as taxable income. Find out how you will owe for the income tax based on your Social Security income from the guidelines below.
- Single retirees with a total income of not more than $25,000 will not be taxed based on the Social Security benefits.
- Single retirees with a combined income between $25,000 – $34,000 will be taxed 50% of the benefits.
- Single retirees with income more than $34,000 will be taxed 85% from the benefits.
- Income of married couples filed jointly which is less than $32,000 will not be taxed. However, income ranging from $34,000 to $44,000 will be taxable by up to 50%. Also, for income more than $44,000, a taxable rate of 85% will be imposed.
It is also important to think ahead about your finances and senior housing cost. If you are going to adapt to the changing life and financial circumstances, it is best to have advanced planning, which is key in the evolution to the new changes in life.
Buying your first home, saving for the education of your children, or planning for retirement are all the same since it is essential to respond to the changing circumstances in life. That is why Social Security benefits are crucial components of any well thought out retirement plan.
If you only observe the numbers, 74% of single seniors and 51% of married couples rely on Social Security benefits in 2016. This is more than 50% of their monthly income. In fact, in the year 1960, 35% of those more than 65 years old lived in horrible poverty, which is opposite to the numbers in 2012 at no higher than 9%.
Living Retirement Life to the Fullest
In order to ensure that you gain the baseline of income, you can seek help from a certified public accountant to provide basic accounting for those that want to prepare for senior housing cost. They are able to help seniors as well as their families to have peace of mind. In this case, seniors are able to live their retirement life to its fullest.
It is important for seniors to consider proper planning when it comes to retirement preparations. Thus, seniors need help to achieve a better life without any problems involving finances and senior housing cost.
Consulting tax professionals or certified public accountants can help a lot in ensuring that they don’t live past their available income. This can guarantee retirees can stay in their own place as long as possible instead of transitioning to senior housing, nursing home, or family member’s home. Moreover, it is important since they need to have financial resources to do so.
Richmont Senior Living is proud to serve Ashland, NE and the surrounding cities: Memphis, Springfield, South Bend, Greenwood, Murdock, Waverly, Murdock, Ithaca, and Chalco