The Ultimate Guide to Maximizing Your Social Security Benefits | personal financing

(Morri Bachmann)

Social Security provides benefits to millions of Americans, many of whom are retired. Even if you still have many years in the workforce, it’s helpful to learn about the different ways you can make more money from the program. Here are some basic tips for maximizing Social Security — and enjoying a higher income stream once your time in the work force is over.

1. Increase your earnings as much as you can

Social Security does not pay the same benefit to everyone. Instead, the amount of money you are entitled to in retirement will depend on how much you earn during your career. If you are able to increase your income, you can set yourself up for higher benefits later.

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Keep in mind that wages are only counted for Social Security purposes to a certain extent. This year, earnings over $147,000 were not counted in Social Security benefits, and next year, that limit could go up. But for the most part, increasing your income is a good way to get higher interest, so make an effort to develop your job skills to prepare yourself for extra pay.

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You may also want to get a side job to increase your income. As long as you pay taxes on this wage, it will count for Social Security purposes.

2. Work at least 35 years

Social Security takes into account your 35 highest paid wages when calculating your benefits. If you don’t work for the full 35 years, you’ll get $0 in this formula for every year you lose income – so you’ll want to make sure you have at least 35 years of earnings on record.

3. Extend your career once your earnings reach their peak

Even if you reach the end of your career after working for 35 years, you can still pay to stay in your job a little longer. If your salary is at its highest once you’re ready to retire, working a few more years means replacing years of lower income with higher ones. Results? A higher benefit to look forward to.

4. Make sure your earnings history is up to date

Each year, the Social Security Administration (SSA) issues workers a statement of earnings summarizing their wages. It is important to review these statements and make sure they are correct. If your income is not adequately reported, this may result in lower monthly interest.

If you are 60 or older, you should receive your annual earnings statement in the mail. Otherwise, you can create an account on the SSA website and access that information online.

5. Timely apply for benefits

The closest you can register for Social Security is 62, but if you apply before your full retirement age (FRA), you’ll look for a reduced benefit. The FRA is based on your year of birth, as follows:

Year of Birth

full retirement age




66 and 2 months


66 and 4 months


66 and 6 months


66 and 8 months


66 and 10 months

1960 or later


Data source: Social Security Administration.

You can also delay registration after an FRA. For every year you do, up to age 70, your benefits will increase by 8%.

Obviously, delaying registration will save you more money on a monthly basis. But before you make that call, think about whether it means getting the most money on a file life times Basis. If you don’t expect to live long (for example, due to health issues or even your personal family history), it may make more financial sense to claim benefits in the FRA or even earlier to get the highest payments for life.

6. Coordination with your wife

It may also be that you and your spouse qualify for Social Security benefits based on your own earnings records. If so, you have a few options to consider.

You can decide for a high-income earner to delay their deposit as long as possible while a low-income earner registers for benefits in the FRA or even sooner. This step makes sense especially if the lower-income earner is expected to live longer than the significantly higher-income earner.

Furthermore, if you earn significantly less than your spouse, you may be able to increase your monthly payments by claiming spousal benefits. Once your spouse has applied for Social Security, you can claim the spousal benefit on his or her record. And if you’ve reached FRA by the time you apply, your spousal benefit will be equal to half of what your spouse collects each month.

So, let’s say that based on your earnings history, you are entitled to a monthly Social Security benefit of $1,200. If your spouse’s benefits are $3,000, paying your benefits to spousal benefits will give you $1,500 per month instead.

To be clear, you can’t hold back and claim your Social Security benefits Plus Marriage benefit at the same time. But you can certainly claim the higher of the two.

Get as much money as possible

Social Security may become an important source of income for you in retirement. Do your best to read the program so that you are in the best position to make as much money as possible.

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