Social Security: Is the $16,728 Yearly Bonus Real?

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Have you heard about the Social Security $16,728 yearly bonus? There’s really no “bonus” that retirees can collect. The Social Security Administration (SSA) uses a specific formula based on your lifetime earnings to determine your benefit amount.

However, there are ways to create your own bonus by maximizing the amount you’re eligible to receive. Here are a few ways to do it:

Increase Your Earnings

Social Security benefits are calculated based on the 35 years you earn the most. If you have years of low or no income, this is also factored into your calculation and decreases your qualifying amount.

According to the SSA, each year you work will replace a zero or low earnings year in your Social Security benefit calculation. This can help to increase your benefit amount. However, there is a maximum amount of earnings used to calculate your retirement benefits. Earnings of up to $160,200 in 2023 are used to calculate your payments, but this amount is adjusted for inflation each year.

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Wait Until Age 70 to Collect

Waiting to collect Social Security benefits until age 70 ensures you receive your maximum benefit amount. 

Only 10% of workers wait until then, but researchers found that claiming before 70 results in an estimated median household loss of $182,370 in lifetime discretionary spending for claimants between the ages of 45 and 62, CNBC reported. Retirement benefits at 70 are 76% higher than benefits taken at age 62, adjusted for inflation.

Claim Spousal Benefits at Full Retirement Age

Married couples should be strategic about claiming spousal benefits. Unlike personal benefits, spousal benefits don’t increase if you delay payments past full retirement age. FRA varies by birth year, but it’s usually age 66 or 67. The SSA says the spousal benefit amount can be based on their own earnings or up to half of the higher earner’s benefit, whichever is higher.

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