3 Social Security secrets for even bigger checks


When it comes to locking in a higher Social Security check, learning the ground rules is a productive first step. Earning more and working longer are important behaviors to focus on if you want your retirement costs to be high.

Only a small fraction of workers reach the maximum Social Security payment of $4,194 per month. Perhaps a more realistic goal is to focus on the factors you can directly control.

Below, we’ll discuss three ways to get a higher monthly Social Security payment in retirement.

1. Earn more

The Social Security system works like an insurance company: You pay “contributions” during your career in the form of payroll taxes and collect benefits amounts in proportion to the amount you have paid. The more you pay into the system, the more you can expect when you file for benefits in retirement. simple.

The Social Security Administration (SSA) taxes employee income at a rate of 6.2%, up to a maximum wage base of $147,000 in 2022 (soon to be increased to $160,200 in 2023). Anything you earn up to this amount will be taxed accordingly, so the more you earn, the more you pay into the system. To the extent that you can earn more, you will be rewarded with a higher monthly check upon retirement.

2. Work more hours

When determining the amount of your primary insurance (PIA), the WAA takes into account your entire employment history. More specifically, it takes into account your 35 highest earning years. If you entered zero income years at any point in your career, those zeros will drag your calculation down. If you don’t have 35 years of work to do it, you might consider working until you do. This ensures a more robust income stream when it comes time to collect profits.

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It’s a smart idea to log into your Social Security account through the Social Security Administration’s website to see where you currently stand, to see if you have zeroes as part of your primary insurance calculation. Income year or not. If that’s the case, depending on how tolerable your current work situation is, it might make a lot of sense to stay in your job a little longer to lock in a higher expense floor in your final years.

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3. Benefits for Spouses

It may seem obvious, but matching with your spouse is an effective way to get the most out of Social Security benefits. If you were the lowest earning or stay-at-home spouse during your career, you are eligible for payments of up to 50% of your spouse’s benefits, assuming your spouse retires. benefits.

If you qualify for Social Security benefits based on your own earnings, you can start collecting them as early as age 62. benefits. ,

You only get the full 50% when you reach your full retirement age, which for those currently in their 60s is between 66 and 67.

Plan your Social Security strategy

Much that determines how much you’ll receive in retirement comes before you file your claim. Earning more and working longer are two keys to more benefits. Aligning with your partner is another way to maximize the total dollars received.

Take the time to consider all factors — both financial and non-financial — and develop a Social Security strategy with your family. If you have any problems, don’t hesitate to contact a qualified financial planner for unbiased advice.

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