I own my own business with my wife.
I earn enough in my business to pay both of us more than the income limit.
Shes a 50% owner in the business and helps with random items.
These are thebiggest money secrets rich people don’t tell you.
We plan on retiring at 67 or 70 (10 or 13 years from now).
-J.
Dear J.,
Yes, youd help your wife boost her future Social Security payments.
In this scenario, you and your wife would pay a lot more in Social Security taxes.
The trade-off might not be worth it.
The $160,200 you refer to is Social Securitys maximum taxable amount for 2023.
This cap goes up pretty much every year.
Any money you earn above this limit isnt taxed by Social Security.
But youre currently earning a lot of money that isnt subject to Social Security taxes.
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But thats a matter to sort out with your CPA.
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Enough small talk.Here are some waysto earn extra cash, without all of the social stuff.
Ultimately, I think you should look at the big picture.
What kind of lifestyle do you want in retirement?
Approximately how much annual income do you think youll need to buy yourself that lifestyle?
As a general rule, you want to replace between 70% and 80% of your pre-retirement income.
But your actual needs will depend on a host of factors.
If you want to be jet-setting seniors who own multiple beachfront homes, youll probably need more.
Decide on a goal, then try working backward.
They can use software to make projections for both your retirement needs and income.
Only about 6% of taxpayers make more than Social Securitys wage cap in a given year.
Earning above the taxable maximum for 35 years is pretty rare.
Many Americans will need to squeeze every last penny out of Social Security to afford retirement.
Fortunately, you might afford a comfortable retirement even if you dont maximize your Social Security benefits.
Robin Hartill is a certified financial planner and a senior writer at The Penny Hoarder.
Send your tricky money questions to[email protected].
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