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A Higher Social Security Benefit Could Be Yours -- if You Make These Key Moves

By Maurie Backman - Feb 4, 2020 at 6:03AM

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Here's how to secure a more robust income stream -- for life.

Chances are, you'll depend on Social Security to some degree during retirement. Maybe it'll constitute the bulk of your income. Maybe you'll have enough savings to pay your bills but those benefits will provide the income you need to travel, enjoy life, and do the things you couldn't do when you were chained to a desk during your working years.

The good news is that a few smart moves on your part could result in a higher monthly paycheck from Social Security -- and a lot more financial freedom and security in retirement. Here are the most important ones to focus on.

Smiling older man at laptop.

IMAGE SOURCE: GETTY IMAGES.

1. Make sure to work for 35 years

Your Social Security benefits are calculated based on your earnings during your highest-paid 35 years on the job. If you don't work a full 35 years, the formula used to determine your benefits will effectively factor in $0 for each year you're without an income, thereby bringing your monthly benefit down. Therefore, if you're nearing the end of your career and realize you're missing a few years of earnings, extending your time in the workforce could give your benefits the boost you're after. This especially holds true if you're earning a generous salary at present.

2. Delay your filing past full retirement age

You're entitled to your full monthly benefit based on your earnings history once you reach full retirement age, which depends on your year of birth, as follows:

Year of Birth

Full Retirement Age

1943-1954

66

1955

66 and 2 months

1956

66 and 4 months

1957

66 and 6 months

1958

66 and 8 months

1959

66 and 10 months

1960 or later

67

DATA SOURCE: SOCIAL SECURITY ADMINISTRATION.

The Social Security Administration (SSA), however, lets you delay benefits past full retirement age and rewards you for doing so to the tune of an 8% annual boost in your income. This means that if your full retirement age is 67 but you don't claim benefits until 69, you'll get a 16% increase.

Now, you should know that you can only accrue what are known as delayed retirement credits until age 70, so once you reach that age, there's no sense in delaying your filing further. But if you aim to hold off on taking benefits as long as possible, you could give yourself a lifelong raise.

3. Check your earnings statements for errors

Each year, the SSA issues you an earnings statement summarizing your taxable income for the year. Many people don't check these statements, especially since they don't automatically come in the mail unless you're 60 or older. But if you fail to review your earnings statement, the SSA might use incorrect information about your wage history to calculate your benefits, leaving you with less money each month during retirement.

How might that happen? Imagine you switch employers during the year, only your new employer fails to report your earnings information so that you're listed as having earned $42,000 one year when you actually earned $90,000. Administrative glitches like this can happen, but clearly, in this example, the difference could be huge with regard to your benefits.

That's why it's important to review your earnings statement each year. Fixing errors that work against you could give you a higher monthly benefit throughout retirement. If you're not receiving those statements by mail, set up an account on the SSA's website to access them there.

There are plenty of good reasons to push for a higher monthly Social Security benefit. Make these moves, and you could be sitting on extra money each month for the rest of your life.

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