Do you want to get the most out of your Social Security benefit? In today’s video, you’ll learn how Social Security is funded and how you can maximize it.
Timestamps:
00:00 – Introduction
1:00 – How Social Security Works
2:03 – Indexing For Inflation
3:00 – Earnings Are Means Tested
4:20 – Understanding Your Social Security Benefits
5:20 – Primary Insurance Amount
6:25 – Importance of 35 Years
7:43 – Delayed Retirement Credits
8:34 – Spousal Benefit
10:16 – Understanding Survivor Benefits
11:07 – Tax Planning & More!
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Social Security is a key component of many Americans’ retirement plans, but did you know that there are simple ways to potentially increase your benefit? By taking advantage of these strategies, you could boost your Social Security income and improve your financial security in retirement. Here are four simple ways to increase your Social Security benefit.
1. Delay Taking Social Security
One of the most effective ways to increase your Social Security benefit is to delay taking it. While you can start receiving benefits as early as age 62, your benefit will be reduced if you choose to do so. On the other hand, if you wait to claim benefits until your full retirement age (typically 66 or 67, depending on when you were born), you can receive your full benefit amount. But the biggest boost comes from delaying beyond your full retirement age. For each year you delay claiming Social Security beyond your full retirement age, your benefit will increase by 8% until age 70. This could result in a significant increase in your monthly benefit amount, so it’s worth considering if you’re able to wait.
2. Work for at least 35 Years
Your Social Security benefit is calculated based on your highest 35 years of earnings. If you worked for fewer than 35 years, zeros will be factored in, which can lower your benefit amount. By working for at least 35 years, you can maximize your benefit by ensuring that you have a full work history to factor into the calculation. If you haven’t already worked for 35 years, continuing to work until you reach this milestone can help increase your benefit.
3. Increase Your Earnings
Your Social Security benefit is based on your highest 35 years of earnings, so increasing your income can also increase your benefit amount. This can be achieved through a variety of means, such as getting a higher-paying job, pursuing career advancement opportunities, or taking on additional work. By boosting your earnings, you can raise your average indexed monthly earnings (AIME), which is a key factor in determining your benefit amount.
4. Consider Spousal Benefits
If you are married, you may be eligible for spousal benefits based on your spouse’s work record. In some cases, it may be advantageous for one spouse to claim spousal benefits while the other delays taking their own benefit to allow it to continue growing. This strategy can help maximize the overall benefit amount for a couple and provide higher income in retirement.
In conclusion, there are several simple ways to potentially increase your Social Security benefit. By delaying claiming benefits, working for at least 35 years, increasing your earnings, and considering spousal benefits, you may be able to boost your monthly benefit and improve your financial security in retirement. It’s important to carefully consider your options and plan ahead to make the most of your Social Security benefits.
"Wait longer to collect." There are a lot of financial planners who disagree with that. For a lot of people, the break even point between ages 62, 65, 67 and 70 is in their mid 80's.
What BS! Total con man at work here.
Sorry… I'm taking at 62.
Life isn't guaranteed.
Social Security is a scam anyway.
James, thanks for your great videos, but I have a few questions/situations that will affect many getting ready to claim retirement benefits.
Due to a 5 year long divorce I've got to keep working after my retirement age.
1. I've read that SS will retire you if you don't tell them you are going to defer until later
Is this true and what do you need to do prior to age 65 to notify them?
Political situation SS running out
2. If Social Security is running out, do I start taking SS at age 65 (3 more months) or wait until age 67?
3. When is the tipping point to where Soc Sec is gone?
I delayed for several years and glad that I did. Not only did that increase my base SS, but now the COLAs give a much larger dollar amount since it’s based as a percentage on your current benefit. So my COLA is much larger than it would have been if I had starter earlier.
One of the best SS explanations on YouTube. A few points to Add, after age 60 the weighting formula no longer applies. If you collect early then they will claw back 50% of your earnings over the cap which is around 21,200 for 2023. HOWEVER you will receive a .7% Increase for every month you lose. So you retire early and they claw back 1 years worth of SS by the time you reach full retirement age you will receive an 8.4% increase the month AFTER you reach full retirement age. Also you can bump off lower earnings years if you earn enough to do so. At 63 I returned to work, and for last year I was over the cap by just over 8,000 So they clawed back 3 months of my SS, but my Dec. check got bumped up by 1% because I bumped a low earnings year. I'm anticipating a larger clawback this year as I will be close to 20,000 over the cap and I'm pretty sure I will bump off another lower earnings year, but I have no way to calculate if I will get another 1% or more (Maybe less).
Another point is that you need 40 quarters to qualify for your own SS retirement, but its actually a dollar amount not time. Sure you can only earn 4 quarters in a year, but the current quarter is 1,640 earn 6,560 snd you have your 4 quarters earned regardless of how many weeks or months you worked.
In my case I had 44 qualifying years where I earned 4 quarters, but I worked some jobs that paid cash in my youth for portions of years, and was collecting Worker's Comp for portions of two years even though I earned quarters, my earnings were not optimal those years.
Something that pisses me off is that there are people who collect Hardship SS even though they never worked in the USA, my wife's Aunt and Uncle came to the USA after retirement age and collect SS as hardship cases, they get a few hundred bucks less than I EACH. Their children, 4 of which have very high incomes in the USA could well support them. 1 is Upper Management @ Target, 1 Is a Cruise Ship pilot, another is an RN, and the 4th is an RN, but in management. Note: 2 of the 4 have spouses working for tips in Casino and Bar jobs. America screws We The People who work eh?
I'm 60 and have been on SSI/ Disability with only 36 credits shuld I work part time and gain the ext credits?
Joe Biden is destroying this country. And he's doing it with the DOJ, the Attorney General. This country is now flooded where a lot of terrorists waiting to do their move. Because these two clowns and other clowns that worked together with them. We American, we the people, we must take action. To order remove all these clowns from office. If we do not make our move, our country will be in danger. We must claim victory and and all this tragedy. Wake up, America. We are facing a crisis that we won't get to stop anymore.
Ok you need to stop fooling people. 1st Social Security is not and never was a benefit nor an old age pension or in a lockbox. In 1934 you had two people, Helvering who was the head of this program and Davis who was saying it was illegal. The name of the decision by SCOTUS was Helvering v. Davis :: 301 U.S. 619 (1937). Now in that decision a Democrat controlled SCOTUS ruled that Social Security was nothing more then another form of a federal income tax that was to be paid into the US Treasury for whatever Congress decided to use it for. Then in 1960 yet another Democrat controlled SCOTUS ruled in Flemming v. Nestor :: 363 U.S. 603 (1960) that Social Security AND any program that came from same could be reduced or stopped at any time for any reason and you had no legal nor moral right to it nor could you get it back if it was stopped or reduced. Which means if they give you nothing for a cola, then you cannot complain as under these two SCOTUS rulings, they really dont have to give you anything. This is clearly listed on the http://www.ssa.gov webpage as well as in the SCOTUS webpage archives so you cant refute it.
Have to love SS. When I retire at 65 (I’m 62 now) I will have paid well over $1m into SS during my working career.. at 65, I’ll get around $3,600 monthly or $43,200 annual. If I live to 85, I’ll only earn around $900k from SS,,, far short of what I put into it…