Do You Know All Four of These Social Security Secrets?

(Dan Caplinger)

If you’d like bigger Social Security checks in retirement, it’s important to know everything you can about the federal government program. Unfortunately, it can be difficult to get the information you need, and many people are still out of the blue when it comes to the key aspects of Social Security that determine how much benefits you get. Below, you’ll learn more about four essential parts of Social Security that aren’t as well known as you think.

1. Boosts earn more – but the amount of boost depends on how much you earn

Your earnings history goes into the 35-year highs in determining your monthly benefit, so increasing your average earnings will increase the size of your Social Security checks. However, people with lower incomes over the course of their careers receive a greater boost from each additional dollar of earnings than individuals with higher incomes.

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Specifically, the formula that determines benefit amounts adds $0.90 to the standard retirement benefit for every $1 in average monthly occupational earnings up to a certain amount, which is $1,115 for those age 62 in 2023.

Once your average monthly earnings exceed this mark, each additional $1 results in just $0.32 in additional benefits, up to $6,721. On top of that, you will get only $0.15 in bonus benefits for a $1 increase to your average monthly earnings.

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2. Retiring at a later date can give your benefits a double boost

Choosing to defer retirement for an additional year can help increase your Social Security benefits in two ways. Many people have peak income years late in their careers, so an additional year of work is often on top of 35 which increases average monthly income. Furthermore, if you can delay claiming Social Security for an additional year because you work longer, your checks will typically be 6% to 8% higher than if you had claimed them earlier.

3. There is no double benefit for the couple

Many people know that married people have access to two different types of benefits. Those with their own work history can claim retirement benefits based on their own earnings, but they can also claim spousal benefits based on a spouse’s work history.

However, you cannot take advantage of these two features and simply add them on. Instead, the Social Security Administration applies the retirement benefit first. If your spousal benefit is greater, the SSA increases your payments to the higher spousal benefit amount. If your retirement benefits are larger, you essentially get no additional benefit from enjoying the right to a spousal benefit.

4. Age 62 is not the earliest date for Social Security benefits if you are a surviving spouse

Most regular and marital worker retirement benefits are available for the first time at age 62. However, if you are married and your spouse has died, you may be entitled to survivors’ benefits, which were available earlier.

Specifically, most surviving spouses can claim a survivor’s benefit starting at age 60. Disabled people can claim at age 50. As with other types of benefits, those who claim early will have to accept reductions in their payout amounts, but can That extra money remains valuable.

One thing to note, too, is that remarriage can end survivor benefits. However, if you wait until age 60 or older before remarrying, you will still be able to claim survivors’ benefit on your deceased ex-spouse’s work record.

Get the benefits you deserve

The concept of Social Security can be complex. Fortunately, some of the basic concepts are very easy to learn as long as you know about them. Make sure you get every penny of Social Security you are entitled to.

The $18,984 Social Security bonus most retirees overlook completely

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