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5 Ways to Increase Your Social Security Benefit With Minimal Effort

By Sean Williams - Updated Oct 14, 2019 at 2:14AM

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Getting more out of Social Security has never been easier.

Social Security is, hands down, our nation's most important social program. Each month, nearly 64 million beneficiaries takes home a payout from the program, with an estimated 22.1 million people pulled out of poverty as a direct result of this payout. If Social Security didn't exist, the elderly poverty rate would be more than four times higher than it is now.

National pollster Gallup also finds that, as a whole, 90% of today's current retirees lean on Social Security as a major or minor source of income, with a combined 83% of non-retirees expecting to rely on their payout to help makes ends meet during their golden years.

With all of this being said, maximizing what you'll receive from Social Security on a monthly basis tends to be pretty important. While a number of factors that go into determining your payout from the program require quite a bit of effort -- i.e., working for at least 35 years for an opportunity to maximize your monthly payout -- there are certain ways to boost your Social Security benefit with minimal effort.

A person filling out a Social Security benefits application form.

Image source: Getty Images.

1. Do nothing when you become eligible for a payout

How's this for minimal effort: When you turn 62 and become eligible to begin taking your Social Security benefit, do nothing.

While your work history, earnings history, and birth year, all play key roles in determining what you'll be paid on a monthly basis, arguably the biggest determinant of monthly payout is when you begin collecting your retired worker benefit. Beginning at age 62, for each year you hold off on taking your payout, your monthly benefit will grow by approximately 8%, up until age 70. Therefore, all things being equal, a retiree claiming benefits at age 70 could net up to 76% more per month than the same individual claiming at age 62.

You should keep in mind that while waiting to take your benefit has been shown to be a smart decision from a statistical perspective, it's not going to be the optimal choice for everyone. You'll need to examine your health, financial, and marital status to determine what the best claiming age is for you.

A mature woman going over financial paperwork with her laptop open in front of her.

Image source: Getty Images.

2. Consider a mulligan

Another easy way to boost your Social Security benefit is by requesting a do-over from the Social Security Administration (SSA).

One of the most under-the-radar Social Security rules is Form SSA-521 (officially, Request for Withdrawal of Application). If you file for and begin taking benefits early, but subsequently regret your claiming decision, you can file Form SSA-521 with the SSA and, if approved, have your claim undone. It would be as if you never took benefits in the first place, which would mean that your monthly payout would again be growing at roughly 8% per year, until age 70.

Of course, there's a catch to this magical mulligan. First, you'll only have 12 months once you begin receiving payouts from Social Security to file this request with the SSA. And second, you're going to be required to pay every cent you've received from the SSA back if your request is approved.

A golden egg with the word IRA written on it that's sitting atop a messy pile of one dollar bills.

Image source: Getty Images.

3. Use a Roth IRA to avoid federal taxation

Another smart move to increase your take-home from Social Security that requires very little effort is to open up and contribute to a Roth IRA. A Roth IRA is a back-end-loaded retirement plan that allows individuals to contribute up to $6,000 in 2019, or $7,000 if they're aged 50 and up. By "back-end loaded" I mean there are no upfront tax benefits. Rather, any capital gains in a Roth IRA can be withdrawn during your retirement years without any tax implications.

A Roth IRA can be especially helpful to those folks who might be facing a tax on their Social Security benefits (yes, your Social Security benefits may be taxable federally, and at the state level). If a person's modified adjusted gross income (MAGI) plus one-half of benefits exceeds $25,000 (or $32,000 for a couple filing jointly), they're going to owe tax on some portion of their benefits. However, eligible Roth IRA withdraws aren't counted as income, meaning it could potentially keep folks under the $25,000 or $32,000 threshold where federal taxation on benefits kicks in. That means more money will stay in your pocket.

A W-2 tax form, highlighting Social Security wages that have been taxed.

Image source: Getty Images.

4. Check your earning history with the SSA

A fourth way to possibly boost your Social Security payout is by checking your earnings history with the SSA.

Despite being very efficient and returning 99% of every dollar collected to eligible beneficiaries, the agency isn't mistake-free. Each and every year, workers should take one or two minutes to compare their earnings on their W-2s and tax filings to what the SSA has in their system. If they match, great! But if they don't, you could have a big problem on your hands that could result in a lower-than-expected payout come retirement.

Should you find an error, you'll want to report it to your nearest Social Security office. Some corrections can be made over the phone, while others require you to go to your local office. Either way, correcting an earnings error is always easier before you begin taking benefits than after.

A senior man counting a fanned pile of cash in his hands.

Image source: Getty Images.

5. Bank on a healthy COLA

Lastly, Social Security recipients can simply sit back and hope that their annual "raise" from the SSA helps them adequately keep up with inflation.

Social Security's inflationary tether since 1975 has been the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The average CPI-W reading during the third quarter of the current year is compared to the average CPI-W reading from the third-quarter of the previous year, and if the value rises year over year, then beneficiaries receive a "raise." This increase in monthly pay is known as the cost-of-living adjustment, or COLA. Save for 2010, 2011, and 2016, COLA has been positive every year since 1975.

While banking on a healthy annual raise is fun, and it requires zero effort on the part of beneficiaries, it's also important to understand that the CPI-W has done a poor job of keeping up with the true inflation that senior citizens are facing. Over the past 19 years, the purchasing power of Social Security dollars has declined by 33% for seniors. That makes relying on COLA for a boost a less than enticing strategy more years than not.

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