Social Security beneficiaries will see a 3.2% increase in their monthly income as we approach the new year compared to what they got in 2023. The Social Security Administration’s (SSA) annual calculation of inflation is the basis for the cost-of-living adjustment (COLA). There are several things you can do to help optimize your benefits over the long and short terms, even though you have no control over the annual COLA amount. Here are some actions you may take and other perks you might not be aware of to assist you in maximizing your Social Security payout.
Recognize Your Options For Claiming
The age during which you will file for your benefits is the second important consideration in calculating your Social Security benefit. The complete retirement age for individuals born in the year 1960 or afterward is 67. Although you can apply for Social Security benefits starting as soon as age 62, the sum of your check will decrease each year you register for benefits before reaching full retirement age. For instance, you will receive roughly 30% less each month if you start receiving benefits at the age of 62 as opposed to age 67. However, your cheque will increase by 8% for each year you wait to file between the ages of 67 and 70, up to a maximum extent of 24% above your full retirement income. If you’re thinking about retiring soon and want to make the most out of your payout, keep in mind that your cheque will grow the longer you delay, at least until you’re 70 years old. The best part is that this increment will remain constant for the remainder of your life.
Maximize Your Salary
Your employment record plays a major role in establishing how much your Social Security income will be. It is imperative to optimize a minimum of 35 years of your work history to receive the maximum benefit, as the SSA only takes into account your 35 greatest-earning years at the time of determining your payout. Even if you can’t squeeze 35 years of good income into one year, you may attempt to maximize your 2024 earnings to increase the amount you’ll receive for the rest of your life, whenever you start taking it out. Please take note that the deadline for determining your benefit has gone if you are currently receiving a Social Security cheque. You should be aware that earning too much before reaching full retirement age may cause a temporary reduction in your compensation.
Utilise The Spousal Benefit
You can be eligible for benefits from Social Security even if you have never worked. You can begin receiving benefits for spouses starting at age 62 if you’re married to an employee who is receiving benefits, but waiting until you reach full retirement age will maximize your earnings. Medicare eligibility also begins at age 65. Keep in mind that the maximum you can receive is equal to half of your spouse’s benefit or your personal Social Security payout. To receive the maximum benefit, you will also need to wait to submit until you reach your own FRA. In 2024, if this is a move you are considering, you may want to speak with a financial or tax professional to be sure you as well as your spouse are receiving the maximum advantage feasible together.