Though Social Security was never designed to sustain seniors by itself, it still serves as a lifeline for millions. In fact, the Employee Benefit Research Institute reports that 59% of retirees today consider Social Security a major source of income. If you're planning to depend heavily on Social Security to pay the bills during your golden years, do everything in your power to avoid losing out on benefits needlessly. Here are a few moves that might slash your benefits and leave you scrambling.

1. Filing for benefits before full retirement age

Though you're allowed to start collecting Social Security as early as age 62, you'll lower your monthly benefits by claiming them prior to full retirement age. That age is a function of the year you were born, 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




What sort of reduction might you be looking at? You'll lose 6.67% of your monthly benefit per year for the first three years you file early and then 5% a year after that. This means that if your full retirement age is 67 but you file at 64, you'll lose 20% of your monthly benefit. If you file at 62, you'll lose 30%. That reduction will then remain in effect for the rest of your life unless you manage to withdraw your benefit application and repay the money you collected within a year. Therefore, commit your full retirement age to memory, and only file before that point if there's a pressing reason to do so.

Senior man and senior woman looking at each other with serious expressions and holding hands.


2. Collecting benefits while working

You are indeed allowed to earn income from a job and receive Social Security benefits at the same time. But if you're in this situation before having reached full retirement age, you'll risk having some of your benefits withheld if your earnings exceed a certain threshold.

That threshold, known as the earnings test limit, changes from year to year. Right now, however, you can earn up to $17,640 without losing benefits. Once your earnings surpass $17,640, you'll have $1 in benefits withheld for every $2 you earn. You'll get more leeway, however, if you'll be reaching full retirement age later in the year. In that case, your first $46,920 is exempt from the earnings test. After that, you'll have $1 in Social Security withheld for each $3 you earn.

Notice how these benefits are being withheld but not lost permanently. Once you reach full retirement age, those missing amounts will be added back to your benefits for a higher monthly payment. But remember, by virtue of filing before full retirement age, you'll face a reduction in your benefits, as mentioned earlier.

3. Filing for benefits after turning 70

Just as you'll face a reduction in benefits by filing for Social Security before full retirement age, you can increase your benefits by filing after full retirement age. For each year you hold off past that point, you'll accrue delayed retirement credits that boost your benefits by 8% a year. This incentive, however, runs out once you turn 70, so there's no sense in waiting to file once your 70th birthday arrives. In fact, if you wait too long to file for benefits after turning 70, you'll risk losing out on income permanently.

Social Security will pay you up to six months of retroactive benefits so that if, for example, you don't file until age 70 1/2, you'll still get half a year's worth of benefits back. But if you delay your filing until age 71, you'll lose out on money that should've been yours.

The last thing you want to do is give up some of your Social Security income. Avoid the above moves, and hopefully, you won't have to.