Insights

3 Unexpected Ways to Claim More in Social Security

If you’re hoping to have plenty of money in your later years, increasing the size of your Social Security check may be one of your priorities. While you’ll always need savings in addition to your monthly retirement benefit to be financially comfortable, boosting your Social Security income just makes sense since this source of funds is guaranteed for life. 
But how can you actually claim more Social Security? There are a number of techniques to try, including exploring these three unexpected ways to boost your benefits.
Image source: Getty Images.

1. Aggressively work to increase your salary over your career 
The amount of your Social Security checks is based on the income you earn during your working life. As a result, increasing income raises your benefit amount. The more you can earn, and the sooner you increase your salary, the larger your benefits will be. 
This means you should try to do everything you can to boost earnings. Some of the steps to take include:
Negotiating your starting salary whenever you take a job
Participating in management training and other advancement programs at your workplace
Requesting a salary increase during annual performance reviews
Taking on overtime to raise your pay
Working a side job
Exploring new job opportunities when they become available 
Developing your career skills in order to increase income 
The more of these tactics you employ, the higher your earnings should grow and the bigger your retirement benefits will be. 
2. Put in more than 35 years on the job
Social Security benefits aren’t based on average wages over your entire career — they’re based on average wages over the 35 years when your inflation-adjusted earnings are the highest. 
Most people will have some years during their career when they don’t earn a ton of money. If you’re just starting out, for example, your initial salary could be very low. Or you may not make much during a year when you’re unemployed for part of the time or take unpaid leave for family or personal reasons. 
If you work exactly 35 years, all of those low-earning years will be included when average wages are calculated. As a result, your benefit checks will end up lower. If you work fewer than 35 years, your situation will be even worse because you’ll have years of $0 wages included when your average wage is calculated. But if you’re earning more later in life and work more than 35 years, each extra year can replace an earlier year of lower earnings. This will translate to a higher average wage and bigger benefits. 
3. Do the math on when you should claim your benefits
Finally, you should be strategic about when to start your Social Security checks. You can claim benefits between ages 62 and age 70. Earlier claims result in smaller monthly checks while later claims result in larger ones. 
If you anticipate outliving your life expectancy, you may be better off waiting to claim benefits as long as possible. You’d get so many big checks late in life once your payments begin that you’ll more than make up for the earlier payments you gave up because you waited.
But if you think you’ll pass away at a relatively earlier age, starting checks early is better. Otherwise you’d end up with less lifetime income. You might die before you get any payments, or may only get a few checks in the future and fail to break even for the payments you gave up due to your delayed claim. 
By taking these three steps, you can claim more Social Security money over your lifetime and end up with more retirement benefits than you would otherwise receive. It’s well worth your efforts to do that. 
 The Motley Fool has a disclosure policy. –

If you’re hoping to have plenty of money in your later years, increasing the size of your Social Security check may be one of your priorities. While you’ll always need savings in addition to your monthly retirement benefit to be financially comfortable, boosting your Social Security income just makes sense since this source of funds is guaranteed for life. 

But how can you actually claim more Social Security? There are a number of techniques to try, including exploring these three unexpected ways to boost your benefits.

Image source: Getty Images.

1. Aggressively work to increase your salary over your career 

The amount of your Social Security checks is based on the income you earn during your working life. As a result, increasing income raises your benefit amount. The more you can earn, and the sooner you increase your salary, the larger your benefits will be. 

This means you should try to do everything you can to boost earnings. Some of the steps to take include:

Negotiating your starting salary whenever you take a job
Participating in management training and other advancement programs at your workplace
Requesting a salary increase during annual performance reviews
Taking on overtime to raise your pay
Working a side job
Exploring new job opportunities when they become available 
Developing your career skills in order to increase income 

The more of these tactics you employ, the higher your earnings should grow and the bigger your retirement benefits will be. 

2. Put in more than 35 years on the job

Social Security benefits aren’t based on average wages over your entire career — they’re based on average wages over the 35 years when your inflation-adjusted earnings are the highest. 

Most people will have some years during their career when they don’t earn a ton of money. If you’re just starting out, for example, your initial salary could be very low. Or you may not make much during a year when you’re unemployed for part of the time or take unpaid leave for family or personal reasons. 

If you work exactly 35 years, all of those low-earning years will be included when average wages are calculated. As a result, your benefit checks will end up lower. If you work fewer than 35 years, your situation will be even worse because you’ll have years of $0 wages included when your average wage is calculated. But if you’re earning more later in life and work more than 35 years, each extra year can replace an earlier year of lower earnings. This will translate to a higher average wage and bigger benefits. 

3. Do the math on when you should claim your benefits

Finally, you should be strategic about when to start your Social Security checks. You can claim benefits between ages 62 and age 70. Earlier claims result in smaller monthly checks while later claims result in larger ones. 

If you anticipate outliving your life expectancy, you may be better off waiting to claim benefits as long as possible. You’d get so many big checks late in life once your payments begin that you’ll more than make up for the earlier payments you gave up because you waited.

But if you think you’ll pass away at a relatively earlier age, starting checks early is better. Otherwise you’d end up with less lifetime income. You might die before you get any payments, or may only get a few checks in the future and fail to break even for the payments you gave up due to your delayed claim. 

By taking these three steps, you can claim more Social Security money over your lifetime and end up with more retirement benefits than you would otherwise receive. It’s well worth your efforts to do that. 

 

The Motley Fool has a disclosure policy.

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