So much about retirement is unpredictable, which is part of why monthly Social Security checks are so reassuring. It's guaranteed income that just shows up in your bank account, no questions asked. But if you want that money to go as far as possible, you need to take steps right now to maximize your benefit.
Here are three of the most important things you can do to supersize your Social Security checks.
1. Maximize your income today
Your income today influences your future Social Security checks, so you should always be on the lookout for opportunities to boost your salary. There are a lot of different ways you could go about this. You might consider working overtime, asking for a raise, or looking for a better-paying job elsewhere. Plenty of employers are still hiring, and many are now offering remote positions.
A side hustle is another option. But if you go this route, you'll have to remember to set aside money for income and Social Security taxes on your own. Make sure you're budgeting for this so you don't run into trouble with the IRS.
The only people this strategy won't help are those who make more than $147,000 in 2022. That's the maximum income subject to Social Security taxes this year. While you can no doubt find ways to put any extra money to good use, it won't help boost your Social Security checks.
2. Delay benefits
When you sign up for benefits also affects the size of your Social Security checks. You can apply as early as 62, but you must wait until your full retirement age (FRA) if you want the full benefit you're entitled to. That's somewhere between 66 and 67 for today's workers.
Signing up early means more years of benefits, but each check will be smaller. Those who sign up right away at 62 only get 70% of their full benefit per check if their FRA is 67 or 75% of it if their FRA is 66.
Delaying benefits increases the size of your checks until you reach your maximum benefit at 70. That's 124% of your full benefit per check if your FRA is 67 or 132% if your FRA is 66.
For those who expect to live into their 80s or beyond, delaying benefits usually leads to more money overall. But if you have a terminal illness or you don't expect to live past your early 70s, signing up earlier could make more sense.
3. Coordinate with your spouse
Married couples also have to think about maximizing their household Social Security benefit. If both partners worked, each may either claim on their own work record or get a spousal benefit, which is up to 50% of their partner's benefit at their FRA. The Social Security Administration automatically gives you whichever is higher.
When both partners have earned a similar amount over their lifetimes, each will likely get the most money by claiming on their own work record. So it makes sense for both to delay benefits as long as possible, provided they don't have any significant health issues.
But if one person has earned significantly more than the other over the years, it's more important for the higher earner to delay. If necessary, the lower earner can sign up for Social Security early to help the couple pay their bills. Then, when the higher earner is ready to sign up, the Social Security Administration will automatically switch the lower earner to a spousal benefit if it's more than what the lower earner is already receiving.
Play around with a few different scenarios until you figure out which will net you the most money overall. Then check in with each other every year or two to see if you need to make any adjustments to your plan.
Once you know roughly how much you can expect from Social Security each year, you need to figure out how much you must save on your own to cover the rest of your expenses. Revisit this every year as well, and update your savings strategy as necessary to keep yourself on track.