3 Ways to Boost Your Social Security Benefits
Although Social Security was never intended to fully fund retirement, and was designed as an income supplement only, many retirees do draw a significant portion of their monthly income from the program. In fact, 62 percent of today’s retirees rely on Social Security to provide for at least half of their living expenses. So, clearly it makes sense to boost those benefits as much as possible. Here are three things you can do, in your fifties and sixties, to potentially lead to larger monthly checks once you retire.
Take advantage of your knowledge and experience. Do you know how Social Security calculates your benefits payments? They are based on your 35 highest-earning years of employment… But if there are zeros or lower figures averaged into the formula (such as your earnings from your twenties and thirties) those numbers will bring down your overall earnings (and therefore your checks).
Right now, while you’re at the peak of your career, remember not to get too comfortable with where you are. Continue to push for advancements, investigate employment options elsewhere, sign up for additional training that might lead to raises, or consider consulting work on the side. If you can earn a bit more each year, you’ll reap a higher Social Security check one day, too.
Consider waiting if you can. We all want to retire as soon as possible, but consider holding out until at least full retirement age. That’s the age, defined by Social Security and based on your date of birth, that you can claim your full benefits. If you can wait a bit beyond that age, you’ll add about 8 percent to your eventual monthly checks for each year that you delay your claim.
Remember, you can change your mind. If you retire and claim benefits early, remember you do have the option to change your mind. Form SSA-521, or the Request for Withdrawal of Application, allows you to cancel your Social Security benefits and wait until later to (re)claim them. If you do this, you will have to repay benefits you’ve received, so keep that in mind before making any big decisions.
For more information on planning for Social Security, give us a call. We can help you do the math, understand what to expect from the program, and help you put together a strategy for a stable retirement.