Increasing Your Social Security Benefits

If you’re looking to increase your Social Security benefits, there are several strategies worth exploring. From delaying your retirement to maximizing your earnings through your career, small adjustments can significantly impact your benefits over time. Exploring options like spousal benefits or taking advantage of retirement credits can also help optimize your Social Security income for the future.

When to Collect Your Social Security Benefits

The ideal time to start collecting Social Security benefits depends on your individual circumstances. While you can start as early as age 62, waiting until your full retirement age (typically between 66 and 67, depending on your birth year) or even delaying until age 70 can result in higher monthly benefits. Delaying provides a “delayed retirement credit” that boosts your benefits by a certain percentage.

Calculating Your Social Security Benefits

Your Social Security benefit is calculated based on your highest 35 years of indexed earnings. Earnings in each year are adjusted for inflation, and the average is taken. The benefit is then determined using a formula that favors lower-income individuals. Maximizing your benefit involves working for at least 35 years and aiming for higher earnings during those years.

Receiving Social Security While Employed

You can work while receiving Social Security benefits, but if you are below full retirement age, your benefits may be reduced if your earnings exceed a certain limit. Once you reach full retirement age, there is no earnings limit, and your benefit will not be reduced. Additionally, continuing to work may allow you to replace lower-earning years in the Social Security calculation.

Maximizing Spousal Benefits

Answer: Spousal benefits are based on the earnings of your spouse. If your spouse is eligible for a higher Social Security benefit than you, you can receive a spousal benefit that is equal to half of their full retirement age benefit. To maximize spousal benefits, consider the timing of when both partners claim their benefits. Coordinating the timing can help maximize the overall household benefits.

Increasing Your Benefits After You Start Receiving Them

Once you start receiving Social Security benefits, the amount is generally set. However, there is an exception. If you change your mind within the first 12 months of receiving benefits, you can withdraw your application, pay back the benefits received, and then restart at a later date. This is a one-time option, and it’s important to carefully consider the financial implications before using it.

Working with a Financial Professional

Working with a financial professional can offer personalized strategies tailored to your unique financial situation, helping you navigate the complexities of Social Security benefits. At Financial Dynamics, our advisory team can provide you with valuable insights into when to start claiming benefits to maximize your lifetime earnings, taking into account factors like your retirement goals and financial needs. We can help you optimize your Social Security claiming strategy, potentially increasing your benefits, and securing a more stable financial future.

Advisory services offered through J.W. Cole Advisors, Inc. (“JWCA”). Financial Dynamics & Associates, Inc. and JWCA are unaffiliated entities.