Increasing the amount of Social Security retirement may seem complicated for many workers in the United States, however, there is a simple action that can make a big difference in monthly checks. Often, people choose to file for their benefits at the earliest possible age, i.e., age 62. While this may seem like an attractive option, it can result in a significant reduction in the monthly payment.
In fact, delaying retirement may be the key to getting a significantly larger monthly check. As an example, a person who might get $1,600 per month if they retire at 62 could increase their payment to $2,000 per month if they wait until full retirement age, set at 67 in most cases. This increase represents substantial financial relief that can improve quality of life during retirement.
The Simple Step to Increasing Retirement
The key to increasing your monthly Social Security retirement check is to delay applying for benefits. Although the Social Security Administration allows you to start getting payments as early as age 62, doing so at this stage permanently reduces the amount. This decrease can be as much as 30% of the full benefit, which represents a considerable loss over the years, something that can directly impact an American retiree’s standard of living.
Conversely, a good idea may be to wait until full retirement age. This means waiting until age 67 for most people. Thanks to this wait, we will get 100% of the benefit contributed. In addition, if the decision is made to delay retirement even further, i.e., until age 70, the monthly amount increases even more because of the additional credits given by the Social Security Administration for each year of delay.
For example, a worker who might get $1,600 if he retires at 62 could increase his monthly check to $2,000 if he waits until age 67. This increase not only improves financial stability during retirement, but also offers greater peace of mind for unforeseen expenses. Even so, each case is totally individual and before making a decision it is a good idea to check our work history and what the benefit we would have in the future would be.
Other factors that influence Social Security
While delaying retirement is a crucial step in maximizing the benefit, there are other important factors that also influence the final amount of the Social Security check. Taking these elements into account can help workers make more informed decisions and get the highest amount possible.
- Years worked: The Social Security Administration calculates the benefit based on the highest 35 years of earnings. If a worker has not accumulated 35 years of work, the missing years are counted as zero, which reduces the average and, therefore, the monthly amount.
- Earned income: The higher the salary during the working life, the higher the Social Security benefit. This is because payments are calculated based on average earnings during the 35 most productive years.
Considering these two factors is essential to ensure that the monthly Social Security check is as high as possible. In this case, combining a delayed retirement age with a solid, well-paying work history can make the difference between a tight retirement and a more comfortable and secure retirement.
