Social Security is a lifeline for millions of retired workers, so much so that a good 65% of beneficiaries rely on it to provide the majority of their income. But if you're not careful, you might end up losing some of those benefits and struggling financially as a result. Here are three Social Security mistakes that could cause your payments to take a plunge.

1. Filing for benefits early

Though your Social Security benefits are based on how much you earned during your career, pulling the trigger too soon on those benefits could cause your payments to drop. You're eligible to receive your base benefit amount once you reach your full retirement age (FRA). If you're not sure what that age is, you can use the following table to figure it out:

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.

Though you're allowed to file for Social Security as early as age 62, doing so will result in an automatic reduction in benefits. Specifically, you'll lose 6.67% of your benefits each year for the first three years you claim before reaching FRA, and 5% a year thereafter. So if, for example, your FRA is 66 and you start taking benefits at 62, you'll slash your payments by 25%. Worse yet, this benefits reduction will remain in effect for as long as you continue to collect Social Security (meaning, the rest of your life).

Serious older man

Image source: Getty Images.

Unfortunately, an estimated 60% of seniors wind up slashing their benefits by taking Social Security before reaching FRA. Unless you have a pressing reason to file early, such as losing your job or running into a costly health issue, waiting until FRA can help you avoid losing out on some of the money that would otherwise be yours.

2. Not checking your earnings record

Government agencies aren't perfect, and so it's not unheard of for a Social Security record to contain errors. But an inaccurate record could end up costing you big time, because as we touched on briefly above, your Social Security benefits themselves are based on your top 35 years of earnings. If you have a year where you earn $100,000, and that somehow gets erroneously recorded as $10,000, that discrepancy could have a huge impact on how much you're eligible for in Social Security benefits.

That's why it's important to check your earnings record regularly, and report any errors you spot. You only get three years, three months, and 15 days after the year in which income is earned to correct an associated mistake, so it really pays to be vigilant. You can follow these steps to get in touch with the Social Security Administration and straighten up whatever inconsistencies you spot.

3. Not making up for time off

Many workers take time off during their careers for a number of reasons, whether to raise children, care for aging family members, or address health issues of their own. But if you do spend a few years out of the workforce, and you don't take steps to compensate later in life, you might wind up unhappy with the amount you get in your Social Security checks.

Remember, for any year you don't work during your top 35, you'll get a big fat $0 factored into your average. If there are enough of those $0 years, you'll wind up with much less to look forward to in the way of Social Security income.

On the other hand, if you extend your career once your income has peaked, which typically happens later in life, you'll boost your base benefit amount by replacing some of those $0 years with strong earnings. Incidentally, studies have shown that working longer can also be good for your health, so if you have the ability to make up for lost time in the workforce, it pays to take advantage.

Getting the most out of Social Security could spell the difference between a comfortable retirement and one that's wrought with financial stress. Avoiding these mistakes could end up putting thousands of dollars back in your pocket during retirement -- right where that money belongs.