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What if someone told you that you could have a guaranteed income stream with inflation protection to help meet your retirement needs?聽You鈥檇 probably be interested. Guess what? You already have this 鈥� it鈥檚 called聽.

For many people, Social Security has become an afterthought when it comes to their聽. They鈥檙e more focused on their 401(k) and IRA accounts and trying to beat the markets every year.聽This is largely due to misunderstandings about how the system works.聽Here are some key facts about Social Security, along with three numbers that are very important when planning for your own retirement.

35

This is the number of years that count toward your Social Security benefits.聽To calculate your benefit, Social Security looks at your income in your 35 highest-earning years. If you worked less than 35 years, then any 鈥渕issing鈥� years will count as zero.聽Continuing to work and replacing years of lower or zero earnings can prove beneficial when calculating your future benefit.聽It also pays to periodically check your earnings history to ensure that Social Security has accurate records.

62

This is the聽聽at which most workers can claim Social Security retirement benefits.聽The important thing to remember is that claiming benefits before your聽聽will substantially reduce your monthly benefits 鈥� and potentially your spouse鈥檚 as well.聽For people who are not optimistic about living a long life or who need immediate income, starting benefits at age 62 might make sense.聽For others, the advantages of waiting can be substantial.

8%

For every year you delay benefits past your full retirement age, you will receive an 8% bump in your benefit until age 70.聽Your benefits would also be adjusted annually for the cost of living, possibly giving you greater incentive to delay.

Of course, there are variables involved in the decision on whether to start benefits. They include the opportunity cost of not receiving and investing benefits at age 62, as well as the chances of dying prematurely.聽That being said, the decision to delay a few years and receive a guaranteed, inflation-protected increase can reap tremendous benefits for most couples.

Now that you have a better understanding of how Social Security works, it鈥檚 time to do some proactive planning. A great place to start is the Social Security website, where you can review your earnings history and聽.聽Determining the optimal strategy for a couple can be confusing considering that there are thousands of options.聽Work with someone who incorporates Social Security optimization into financial planning strategies.聽Does your current聽聽do this?聽 Protecting your family against unexpected inflation, down markets and longevity should prove beneficial when putting your plan together.