What if I told you there’s a way to increase your Social Security benefits - but 96% of retirees miss out on it? That’s right - nearly everyone is leaving money on the table, often without even realizing it. They claim too early, fail to optimize their earnings, or overlook key strategies that could add tens of thousands of dollars to their retirement income. And once you lock in a lower benefit, there’s usually no going back.
Today, I’m going to share five strategies to help you maximize your Social Security benefits and make sure you’re not leaving money on the table like so many retirees. Plus, at the end, I’ll reveal a bonus strategy that most people overlook but can give your benefits an even bigger boost over time. So stay with me until the end - you won’t want to miss this!
Social Security is a key part of retirement for millions of Americans, but it’s not just about claiming your benefits and hoping for the best. How and when you claim, your work history, and even your marital status can all impact how much you get. And let’s be honest - with rising costs, every extra dollar counts. So, what can you do to make sure you’re getting the most out of it? Let’s dive into the strategies.
5 Strategies to Maximize Your Social Security Benefits
Delay Claiming Benefits
One of the ways to increase your Social Security benefit is to delay claiming it. Now, I know waiting isn’t easy. If you claim benefits at 62, the earliest possible age, you’ll get less each month – for the rest of your life. But if you can hold off until your full retirement age - usually around 67 - or better yet, until 70, your monthly benefit could be up to 70% higher.
Let’s look at an example. Suppose a high earner has a Primary Insurance Amount (PIA) of $3,500 and a Full Retirement Age (FRA) of 67. If he claims Social Security at 62, he’ll get 70% of his PIA, which is $2,450 per month. Waiting until FRA means he gets the full $3,500. But if he delays until 70, his benefit grows by 8% per year after FRA, reaching $4,340 - 77% more than if he had claimed at 62.
That’s a huge difference when you consider you might be drawing Social Security for 20 or 30 years.
Work Longer to Increase Your Earnings Record
Your Social Security benefit is based on your highest 35 years of earnings. If you don’t have 35 years of work history, zeros get averaged in, which lowers your benefit. Even if you have 35 years, replacing lower-earning years with higher-paying ones can boost your monthly check. Continuing to work and increasing your income, even in your later years, can significantly impact your lifetime benefit.
It's worth mentioning that if you continue working at a lower salary, such as switching to part-time, your PIA won't decrease. Once your PIA is calculated at age 62, only higher earnings can increase it - lower earnings won't reduce it.
Maximize Spousal and Survivor Benefits
If you’re married, divorced, or widowed, you may be eligible for additional benefits based on your spouse’s work history. Spousal benefits can be up to 50% of your partner’s benefit, while survivor benefits can be as much as 100%. Coordinating when each spouse claims can lead to higher combined lifetime benefits. Many people don’t realize they could be missing out on thousands simply by not taking advantage of these options.
Optimize Tax Planning to Keep More of Your Benefits
Up to 85% of your Social Security benefits could be taxed depending on your other income. However, strategies like strategic withdrawals, Roth conversions, and tax-efficient investing can help lower your taxable income and reduce the taxes owed on your benefits. The less you pay in taxes, the more of your Social Security check you get to keep for your retirement.
Consider Claiming on an Ex-Spouse’s Record
If you were married for at least 10 years, are currently unmarried, and your ex-spouse’s benefit is higher than yours, you may be eligible for spousal benefits based on their work record. This can be a valuable option, especially if your own earnings record is lower. And the best part? It doesn’t affect your ex-spouse’s benefits at all.
Bonus Strategy: Take Advantage of Cost-of-Living Adjustments (COLA)
One often overlooked and the easiest way to increase your benefits is through annual Cost-of-Living Adjustments. Since Social Security benefits are adjusted for inflation, the longer you wait to claim, the higher your starting benefit - and the greater impact COLAs will have over time. Someone who claims at 70, rather than 62, will see significantly larger COLA increases in dollar terms over their lifetime. The higher the benefit is, the higher the COLA increase will be.
Let’s revisit our example. Our retiree has a PIA of $3,500 and a Full Retirement Age of 67. If he claims Social Security at 62, his monthly benefit will be $2,450, which 30% less. With a 2.5% cost-of-living adjustment, his payment would increase by $61.25. But if he waits until 70 and receives $4,340, the same 2.5% COLA would add $108.50 - $47.25 more per month. While these increases might seem small at first, they accumulate over the years and can make a big difference.
What If You Already Claimed?
If you already started claiming Social Security but regret it because you realized you locked in a lower benefit for life, your financial situation has changed, or you’ve learned about strategies that could increase your future payments, you may have options to fix it. If it's been less than 12 months since you filed, you can withdraw your application, repay benefits, and restart later at a higher rate. If more than 12 months have passed, you can suspend benefits at full retirement age and earn delayed retirement credits (up to 8% per year until age 70). These strategies can help reverse an early claiming mistake and boost your lifetime income.
Final Thoughts
Social Security may seem like a simple program, but the reality is that small decisions can make a huge financial difference over time. Whether it’s delaying your claim, maximizing spousal benefits, or planning around taxes, every strategy you use can add up to more money in your pocket. The difference between a good retirement and a great one often comes down to knowing how to increase your benefits wisely.
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Social Security Analysis Report
If you’d like our assistance in reviewing your Social Security benefits or determining the best claiming strategy, feel free reach out to us to request your complimentary Social Security Analysis Report.
