Social Security: 10 smart ways to get more benefits
Author and lecturer Zig Ziglar once joked, “If you want to earn more, learn more.” This is often true for our careers, as adding certifications, degrees, or skills to our resume can make us more marketable. That’s true for a lot of things too – even Social Security.
The more you know about Social Security, the better you will be able to get out of the program. Here are, for example, 10 ways to increase your benefit checks:
- Check your Social Security work record for errors
- Work for more years – at least 35
- Boost your earning record
- Waiting 70 years to start collecting benefits
- Start receiving benefits at age 62
- Take advantage of spousal benefits
- Consider delaying your divorce
- Don’t earn too much while collecting benefits
- Check if you are eligible for survivor or disability benefits
- Be strategic – especially with your spouse
Let’s take a closer look at each of them.
1. Check your Social Security work record for errors
Let’s start at the source. The Social Security Administration (SSA) keeps records of our income and uses its forms to determine our potential benefits. If his record of your income is wrong, however, you could end up receiving less than you are entitled to. Head to the my social security on the SSA.gov website and create an account. Then you will be able to see your SSA earnings history. If you find any errors, contact the SSA to have them corrected. Your account will also allow you to see estimates of your future benefits, which can help you with your retirement planning.
2. Work for more years – at least 35
The formula the SSA uses to calculate your benefits is based on your earnings during the 35 years in which you earned the most – adjusted for inflation, of course. So if you’re on track to work for only 28 years and then retire, know that the SSA will insert seven zeros into the formula, which will lower benefits for you. If you can work a few more years, you can significantly increase your benefits.
3. Increase your earnings record
If you can increase your income, you can get bigger benefit checks. You might aim to earn more in future years by changing jobs or careers or simply moving up the ladder faster, perhaps adding more certifications or skills, to make yourself more valuable. Also, after you’ve worked for 35 years, if you’re earning a lot more than before on an inflation-adjusted basis, you might work a few more years, because that will allow you to replace some low years. income. with some better paid.
4. Wait until you’re 70 to start collecting benefits
Procrastination is generally not a good thing, but if you can delay the start of collecting your Social Security benefits, you can increase them. We each have afull retirement age, “at which we are entitled to receive all the benefits we have earned based on our work record. For most of us, it’s 66 or 67. For each year after that age that you delay to start collecting your benefits increase about 8%. So delaying from 67 to 70 will give you 24% bigger checks. There is no increase after age 70, so you might as well start collecting at that time.
The chart below shows how much bigger (or smaller) your Social Security benefit checks will be depending on when you start collecting:
Start collecting at: |
Full retirement at age 66 |
Full retirement at age 67 |
---|---|---|
62 |
75% |
70% |
63 |
80% |
75% |
64 |
86.7% |
80% |
65 |
93.3% |
86.7% |
66 |
100% |
93.3% |
67 |
108% |
100% |
68 |
116% |
108% |
69 |
124% |
116% |
70 |
132% |
124% |
5. Start collecting benefits at age 62
The table above shows how much smaller your checks will be if you start cashing early – and you can start receiving regular retirement benefits at age 62. It may seem silly to start early and get smaller checks, but remember:
- You could just need income sooner, perhaps due to an unexpected job loss.
- Although the checks are smaller, there will be many more.
- The system is designed so that those living an average lifespan get roughly the same total benefits regardless of when they start collecting benefits.
If you think you have a decent chance of living a shorter than average life due to poor health or family history, it may be a good idea to start collecting early – that way you’ll get more out of the program.
6. Take advantage of spousal benefits
You might assume you’re out of luck with Social Security benefits if you don’t have enough of a work history to qualify for benefits – perhaps because you’ve been a homemaker for most of your life. Well, meet the “spousal benefit. “Social Security rules allow you to receive a benefit based on your spouse’s earnings. You can receive up to 50% of your spouse’s benefits.
7. Consider delaying your divorce
Speaking of spouses, you might even be able to collect benefits based on your old spousal earnings record – as long as you qualify under the rules. For example, you must have been married for at least 10 years. So if you’re considering divorcing your spouse and you’ve been married for, say, nine years – and your future ex-spouse has a significantly higher income history than you – consider delay divorce for another year, if that sounds like something you can do. (It won’t make sense to some people, but to others it might.) For some people, it’s a good way to collect bigger benefit checks.
8. Don’t Earn Too Much While Collecting Benefits
Next, be aware that if you work and earn more than a certain amount while collecting Social Security benefits, a portion of those benefits will be withheld. According to the Social Security Administration:
If you are below full retirement age for all of 2020, we must deduct $1 from your benefits for every $2 you earn over $18,240. If you reach full retirement age in 2020, we must deduct $1 from your benefits for every $3 you earn over $48,600 until the month you reach retirement age. full pension.
It’s not as bad as it sounds, however, because any dollar withheld is rolled back into your future benefits, increasing them accordingly.
9. See if you qualify for survivor or disability benefits
Not only are there Social Security benefits for spouses and ex-spouses, but there are also benefits for the disabled and survivors. There are disability benefits available to eligible people of all ages through two programs: Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI), which differ in who they are meant to help and what they offer . Meanwhile, if your spouse dies after working enough to qualify for Social Security benefits, you – and possibly your children as well (up to age 17) – may be able to collect survivor benefits depending on the income history of the deceased.
10. Be strategic – especially with your spouse
Some of the ideas above involve strategizing, such as working harder to bolster your income and deciding when to start collecting benefits. But a little more research and find out about social security can give even more ways to increase your benefits.
Coordinating with your spouse is a good example: if your spouse has a much stronger income history than you, they might try delaying the start of payments until age 70 to maximize the amount of checks, while you claim your benefits sooner. or in time, just to start getting more income for your household. This can be an effective strategy because if your spouse predeceases you, you are allowed to collect either your own benefit checks or theirs – whichever is greater – and your spouse’s checks will have been inflated as much as possible.
The more you know about Social Security, the more you may be able to get out of the program. Remember, the more you learn, the more you earn.