Social Security is a nice supplement to your personal retirement savings, but there isn’t a retiree alive who doesn’t wish that that check were just a little bit bigger. The average Social Security retirement benefit is $1,417 per month, but with careful planning, you can beat the average and ease the strain on your own retirement savings. Here are three surefire ways to boost your Social Security benefits.
1. Work at least 35 years
Your Social Security benefits are calculated based on your average monthly earnings during the 35 most prosperous years of your life. If you don’t work 35 years, you’re automatically at a disadvantage because you’ll have several zeros factored into your average, reducing your benefits. And if you work for less than 10 years, you won’t be eligible for Social Security at all.
If you want to get the largest Social Security check possible, you should aim to work more than 35 years. Most people earn more later in their lives than they did when they first entered the workforce. By working more than 35 years, those lower-earning years will be replaced by your later, higher-earning years when your Social Security benefits are calculated. This will result in a larger monthly check.
2. Increase your income
As I mentioned above, your Social Security benefits are calculated based on the 35 most prosperous years of your life. So anything you can do now to increase your income will automatically result in higher Social Security checks when you’re ready to retire.
There are several ways you could approach this. You could aim for raises or promotions at your current job, seek out a higher-paying job, or pick up a side gig to help you earn extra income in your spare time.
But if you’re lucky enough to make more than $128,400 this year, earning more won’t help your Social Security benefits. No money earned beyond this limit is subject to Social Security tax, and thus, it won’t do you any favors when you apply for Social Security later.
3. Delay benefits
You can begin claiming Social Security benefits at 62, but you have to wait until your full retirement age — 66 or 67, depending on the year you were born — in order to receive 100% of your scheduled amount per check. If you begin claiming early, you will receive a reduced amount per check. Those with a full retirement age of 66 who begin claiming benefits at 62 will receive only 75% of their benefits per check, while those with a full retirement age of 67 who start claiming at 62 will receive only 70%.
If you can afford to do so, it makes sense to delay taking Social Security, at least until your full retirement age. But it’s even better if you can wait until age 70. The longer you wait to begin taking Social Security, the larger your checks will be, until you receive the maximum benefit of 124% or 132% at age 70, depending on whether your full retirement age is 67 or 66.
To give you an example of how much of a difference that makes, let’s say you’re entitled to the average Social Security payment of $1,417 per month. If your full retirement age is 67 and you waited until then to take benefits, you would receive $1,417 per month. But if you began taking Social Security at 62, you would receive only $992 per month. If you waited until age 70, you would receive $1,757 per check.
It pays to understand how your Social Security benefits are calculated and what you can do to influence them. By taking these simple steps, you can reap the benefits of larger Social Security checks and a more comfortable retirement.
