Social Security Has a ‘Treasure Trove’ of Benefits If You Heed These Expert Tips
Oftentimes, taxpayers apply for Social Security, see the benefit they are owed and don’t think about it much else. One expert, though, argues that Social Security is an untapped well of potential that can net you big if you play the system right.
Economics Professor at Boston University and Social Security expert Laurence Kotlikoff writes in this new book: “There are many ways to turn your lifetime Social Security benefits into a treasure trove,” CNBC reports.
The author of “Money Magic: An Economist’s Secrets to More Money, Less Risk and a Better Life” says that Social Security is potentially the”biggest source of retirement funds” that you are overlooking.
One of the biggest arguments he makes is that there are available benefits, in addition to their regular monthly social security benefit check, that many are unaware of.
Kotlikoff highlights that there are 13 different kinds of benefits you can receive, which include disability benefits, spousal benefits, divorced spousal benefits, child-in-care spousal benefits, widow/widower benefits, child benefits, disabled child benefits, mother/father benefits, divorced widow/widower benefits, parent benefits, grandchild benefits and death benefits.
The main problem for most people is that they simply do not apply for them. These kinds of benefits need to be applied for, meaning even if you are eligible, you will not automatically receive them from Social Security even if you are entitled to them.
A good example of this is spousal benefits. As GOBankingRates previously reported, spousal benefits can boost your monthly benefit by as much as $800 extra dollars a month. For many seniors, this is a huge deal. Spousal benefits allow you to receive social security benefits based on your spouse’s earnings record (if their earnings were higher.) This means you can continue to receive your own benefits AND spousal benefits. The catch is, you don’t know what you don’t know, and without applying you will receive nothing.
Beyond applying for all the different types of benefits you can, the timing in which you claim benefits also has a huge impact on the overall total of benefits you receive.
Kotlikoff highlights that waiting until age 70 is ideal in maximizing your benefits. The earliest you can draw on Social Security benefits is age 62, but you will receive a smaller check if you decide to draw on benefits early. According to the Social Security Administration, starting retirement at age 62 can sometimes result in as much as 30% less in your monthly check.
The longer you wait, the more you receive each month and if you wait until the maximum distribution age of 70, you will receive the maximum Social Security benefit for your record.
Important to note: over the course of a lifetime, the total amount of money distributed will more or less be the same, but if you prefer a larger monthly check later on versus a larger number of smaller ones earlier, waiting to claim benefits is the right choice.
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