Please ensure Javascript is enabled for purposes of website accessibility

3 Surefire Ways to Grow Your Social Security Paycheck

By Maurie Backman - May 29, 2021 at 5:18AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Want more money out of Social Security? These easy moves could be your ticket.

You'll probably rely on Social Security to at least help cover your senior living expenses. To that end, it pays to lock in the highest monthly benefit you can. Here are three easy ways to pull that off.

1. Boost your earnings with a side job

Some people assume that Social Security benefits are universal, and all seniors collect the same amount every month. But actually, your monthly benefit will be based on the amount of money you earned during your 35 highest-paid years in the labor force. And if you want to secure a higher benefit during retirement, the answer is simple -- boost your earnings.

You can guarantee yourself a jump in earnings by getting a side job on top of your main one, and these days, the gig economy is loaded with opportunities. While things may be a little tighter right now due to the pandemic, in time, they should open up again. Not only will your side income count toward your recorded wages, but it'll also give you more flexibility to fund a retirement savings plan, which will also help you secure more income during your senior years.

Social Security card

Image source: Getty Images.

2. Delay your filing as long as possible

You're entitled to your full monthly Social Security benefit based on your earnings history once you reach full retirement age, or FRA. That age is either 66, 67, or somewhere in between, depending on when you were born.

However, you're not required to claim benefits at your precise FRA. You can file sooner -- as early as age 62 -- for a reduced benefit, or you can delay your filing past FRA and give your benefits an 8% increase for each year you do. Any boost you snag for your benefits will remain in effect throughout your retirement.

3. Correct errors on your yearly earnings statements

Each year, the Social Security Administration (SSA) puts together an earnings statement that summarizes your annual wages and estimates your future retirement benefit. But if the information on that statement is wrong, it could cause you to get stuck with a lower benefit than you're entitled to.

Say you earned $110,000 last year but switched employers midway through, and one of your employers failed to report your income. You may, in that case, wind up with just $60,000 of income on file for the year when in reality, you took in a lot more. That's why it's crucial to review your earnings statement each year. Correcting errors that work against you could result in a higher retirement benefit.

If you're 60 or older, you'll get your earnings statement in the mail automatically. Otherwise, you can access yours through the SSA's website.

Snag that higher benefit

The money you save for retirement in an IRA or 401(k) plan could run out on you during your senior years. Social Security, on the other hand, is guaranteed to pay you a monthly benefit for life, so the higher a paycheck you score, the more financial security you'll buy yourself, no matter how long your retirement lasts.

The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
389%
 
S&P 500 Returns
125%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/13/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.