Retirement can be an exciting period of life. But let's face it -- it can also be stressful.
Many seniors are caught off guard when they realize how expensive post-work life can be. And given the way healthcare costs have a tendency to rise in retirement, it's no wonder so many seniors wind up in a serious financial crunch.
That's why it's important to get as much money as you can out of Social Security. The higher a monthly benefit you lock in, the more financial freedom you'll buy yourself at a time when working may not be an option (or at least not a desirable one).
The average senior on Social Security today collects a benefit worth $1,661 a month. But if you play your cards right, you can do a lot better than that. Here are just a few steps you can take to snag a higher payday.
1. Fight for higher wages
When's the last time you marched into your boss's office and negotiated a raise? Talking money can be uncomfortable, but in today's labor market, workers have more bargaining power due to sky-high quit rates. And so if you do some research and see that there's room for growth on the salary front, it pays to fight for it.
The monthly Social Security benefit you're entitled to in retirement will hinge on how much money you make during your highest-paid 35 years in the workforce. If you're able to snag a salary boost, you could set yourself up for a higher benefit.
2. Boost your wages with a second job
Getting a side hustle may read like a trendy thing to do, but it could actually serve the very important purpose of boosting your Social Security benefits. The wages those benefits are based on aren't limited to what your main job pays. If you do side work on a freelance basis and report that income (which you're required to do), it'll count for Social Security purposes, which could potentially lead to a higher benefit.
Of course, growing your wages could work to your advantage on a near-term basis, too. It could make it easier to pay your bills as inflation roars, and it could free up more cash to pad your savings or invest with.
3. Delay your filing
You're entitled to your full Social Security benefit based on your earnings history at full retirement age, or FRA. FRA hinges on your year of birth, and it's either 66, 67, or somewhere in between.
For each year you delay your Social Security filing beyond FRA, your benefit grows 8%, up until age 70. And so if you're able to hold off on signing up, you could snag a substantial boost.
Now to land in a position where you can delay your Social Security claim until age 70, you may need to work until age 70. But actually, that could help raise your monthly benefit, too.
Many people end up earning more money late in their careers than earlier on. If you work a few extra years, you could replace some lower-wage years with higher wages, boosting your benefit in the process.
Social Security could end up being an income source you rely on heavily in retirement. Use these tips to score a higher benefit -- and buy yourself more financial peace of mind.