How To Maximize Your Social Security Benefits Without Extra Work
Written by
Rafaela Stalbalk Klose
Edited by
Jenna Klaverweiden
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Many people assume the only way to increase Social Security income is to keep working longer. The good news is that’s not always necessary. Simply choosing the right time and approach for claiming benefits can make a meaningful difference in retirement income without adding a single extra day on the job.
Here are some ways to maximize your Social Security benefits without extra work.
Also see three Social Security lessons one new retiree learned in retirement.
Delay Claiming Social Security
Age 62 is the earliest age at which most people can start collecting benefits. However, filing at that age permanently locks in a lower monthly payment for life. Waiting until full retirement age provides 100% of the benefit earned through a lifetime of work.
Delaying beyond full retirement age can increase payments even further. According to the Social Security Administration, for those born in 1943 or later, each year of delay adds roughly 8% to the monthly benefit, with no additional increase after 70.
Even waiting a year or two can make a noticeable difference. Charles Schwab’s Social Security guide noted that comparing different starting ages often shows a meaningful increase in lifetime income for those who delay.
Health, expected life span and other sources of retirement income should be considered before choosing a start date.
Look Into Spousal Benefits
Married couples have additional options. Social Security rules allow a lower-earning spouse to receive benefits based on a higher-earning spouse’s record if certain requirements are met. According to the Social Security Administration, “If a spouse is eligible for a retirement benefit based on his or her own earnings, and if that benefit is higher than the spousal benefit, then we pay the retirement benefit. Otherwise we pay the spousal benefit.”
And there are options that extend beyond currently married couples. Divorce does not automatically end eligibility for certain benefits. Individuals who were married for at least 10 years may be able to claim Social Security based on a former spouse’s earnings record. Surviving spouses may also qualify to receive payments based on their spouse’s earnings record.
Plan for Taxes
Taxes can also affect how much Social Security income ends up in a retiree’s pocket. According to the Center for Retirement Research at Boston College, as much as 85% of benefits can become taxable.
According to Charles Schwab, there are ways you can manage your overall tax liability in retirement, including delaying claiming Social Security benefits, considering a Roth conversion, managing investment income wisely and maximizing charitable contributions.
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