How to Maximize Your Social Security Benefit

You have worked hard and are finally ready to enjoy your golden years aka retirement. And yes, you have also planned and saved for these future retirement years. Maybe you planned many years ago or maybe you planned just recently; but either way, you probably factored in the boost offered from your future Social Security benefits. Whatever the boost might be, wouldn’t you want to maximize those benefits if possible? If the answer is a resounding “YES”, then you need  to learn about the various claiming strategies, and fully discuss them with your financial coach. The proper strategy can amplify your lifetime Social Security benefits significantly.

Wait As Long As You Can

An example of one strategy is waiting as long as possible to start claiming your Social Security benefits. The earliest age that a retiree can start claiming these benefits is 62 years old. However, did you know that once you reach your full retirement age (between 66 -67), your social security benefits increase by about 8% each year plus inflation adjustments? A guaranteed 8% growth rate year over year is unheard of these days in the investing world.  Your benefits are maxed out at the age of 70.

Other Strategies

Are there claiming strategies that can optimize your Social Security benefits even if you need to start collecting at an earlier age? The answer is “Yes”. Advantageous strategies can be applied to this situation as well when you know how to maneuver through the claiming process… you just need the proper expertise to guide you through the rules.  There are many different situations and needs but here are just a few strategies that might fit your situation.

Spousal Benefit

Spousal benefit is getting half of the Social Security benefit of your spouse.  If your individual benefit is less than half of your spouses benefit then it is wise to take the spousal benefit in most cases.  This is especially true if you are older than your spouse, since you can claim half of what their full benefit would be, as long as you are at the full benefit age.  This is true even if they are not at the full benefit age yet.

File and Suspend

The file and suspend strategy is a unique way to use the spousal benefit to your advantage.  The strategy involves the higher wage earner filing for and then suspending their benefits at full retirement age.  This allows the spouse to receive their spousal benefit, while the higher wage earner can wait for a future time when they can take their benefits at a much higher amount.  This is a great way to increase your overall benefit in the long term, while still giving a small amount of income while waiting to max out the benefit.

Seek Help

There are many other aspects and complications that can be thrown into the mix, but those are just a few options to think about.  Overall, these claiming strategies can cushion your retirement years with thousands of dollars. If you are thinking about navigating through your Social Security claiming process alone, it might be very unrealistic because the rules behind these strategies can be complex and confusing.  It’s best to seek the help of a financial coach who has an in-depth knowledge of the best Social Security strategies for retirees.  Make certain that you fully learn and understand the rules of each strategy before you choose. You can add thousands of dollars to your retirement funds just by applying the right Social Security claiming strategy for you.

By Jimmy Hancock