5 Money Moves To Make in Early 2025 To Maximize Your Social Security Benefits
Written by
Kerra Bolton
Edited by
Cory Dudak
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Boosting your Social Security benefits now rather than later will significantly help increase future payouts and plan for a comfortable retirement. Whether you’re years away from retirement or approaching retirement age, taking small steps now could yield big benefits later.
Here are five money moves to make in early 2025 to maximize your Social Security benefits.
Boost Your Income
Older workers remain a strong and vibrant part of the nation’s workforce. According to an Employee Benefit Research Institute (EBRI) report, the prime working age population (25 to 64 years old) has significantly fallen, and older workers are filling the gap, with baby boomers making up the largest share of the workforce.
According to data collected by Vox, many boomers chose to remain in the workforce because they can’t afford to retire, rising healthcare costs and longer life expectancies. Other older workers enjoy the structure and purpose that come with work and may not feel ready to retire.
In addition, Social Security benefits are calculated based on an individual’s highest 35 years of earnings. Therefore, if potential beneficiaries have fewer than 35 years of earnings or low earning years, those years are averaged as $0.
Retirees should consider working extra years to find opportunities to increase their income to replace lower-earning years. This could significantly increase their average monthly earnings.
Delay Claiming Benefits
Tom Buckingham, the Chief Growth Officer at Nassau Financial Group, said the best thing retirees can do to boost their future Social Security benefits if they haven’t claimed them yet is to wait another year or more to do so.
“The benefits of waiting to claim until as late as age 70 are significant,” Buckingham said.
Retirees should consider their budget and determine whether they can rely on savings, part-time work or other income sources to postpone claiming. The Social Security Administration’s Retirement Benefits Calculator can help older adults assess how waiting will affect their monthly benefits.
Take Stock of Your Finances
Consult with a certified financial planner (CFP) who can provide personalized guidance and help navigate important questions and make informed decisions.
“You and your CFP should carefully review your current budget and estimate your cash flow needs,” said Melissa Murphy Pavone, founder at Mindful Financial Partners. “Before taking retirement assets and potentially paying an early distribution if prior to age 59 ½, take a look at your emergency fund.”
Pavone explained, “Individuals often overlook the impact of healthcare costs in retirement. This added expense, if not accounted for, can quickly deplete retirement savings.”
Review Your Lifetime Earnings
Mistakes in retirees’ earnings records could cost them money.
For example, if an employer didn’t properly report one year of an employee’s earnings to Social Security, the error could reduce an individual’s future benefit payments.
According to the Social Security Administration’s website, “Over your lifetime, that could cost you thousands of dollars in retirement or other benefits that you’re entitled to receive. It’s important to identify and report errors as soon as possible.”
In addition, the longer retirees wait to report and correct errors, the harder it could be for them to get old tax documents. In addition, some employers may no longer exist or be able to provide past payroll information.
Broaden Your Retirement Strategy
Social Security should only be one piece of retirees’ income strategy. Ideally, Social Security should be able to replace about 70 to 80% of an individual’s income, and makeup around 40 to 50% of a person’s overall retirement income.
Financial advisors recommend having multiple income streams during retirement — including other savings and investments, pensions and retirement accounts — to maintain a comfortable retirement lifestyle.
“One great option is a fixed indexed annuity with guaranteed income benefits,” Buckingham said. “These products are a great source of supplemental income for life. There are even products that allow the owner to take a higher income for a period of time, which could provide a bridge that allows them to delay claiming Social Security to enrich those benefits. Such a combination would be a strong foundation of a retirement plan.”
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