The more money you collect from Social Security during retirement, the more financial freedom you'll have. Unlike your retirement savings, which could, unfortunately, get depleted in your lifetime, Social Security is designed to pay you a monthly benefit for life, so the higher a benefit you lock in, the more money you'll get on a long-term basis.
Your Social Security benefit itself is based on the amount of money you earn during your 35 most-profitable years in the labor force. But if you make one simple move, you can actually boost your benefit by a very impressive 24%.
Your ticket to a higher benefit
You're entitled to your full monthly Social Security benefit based on your earnings history once you reach full retirement age, or FRA, which is based on your year of birth, as follows:
Year of Birth
Full Retirement Age
66 and 2 months
66 and 4 months
66 and 6 months
66 and 8 months
66 and 10 months
1960 or later
However, you don't have to claim benefits precisely at your FRA. You're actually allowed to sign up for Social Security beginning at age 62, but for each month you file before FRA, your benefit gets reduced on a permanent basis.
On the other hand, if you delay your filing past FRA, your benefit will increase by two-thirds of 1% for each month you hold off. This means that your benefit will increase by 8% for each year you delay your filing.
Once you turn 70, your Social Security benefit can't grow anymore, so you might as well claim it at that point. But if your FRA is 67 and you delay your filing all the way until age 70, you'll boost your benefit by a very generous 24% — for life.
So, say you're entitled to a monthly benefit of $1,500. Delaying your filing one year will grow that benefit to $1,620. Waiting two years will leave you with $1,740 a month. And holding off as long as possible — three years — will give you a benefit of $1,860. That translates into $4,320 a year of additional income, which could go a long way toward paying for things like healthcare expenses, home maintenance, and travel.
Should you delay your Social Security filing?
In some cases, holding off on claiming Social Security can be difficult, such as if you're unable to continue holding down a job or you need extra money to cover surprise expenses. And if you don't expect to live a long life, then delaying your filing isn't smart, because while it raises your monthly benefit, it could also leave you with a lower lifetime benefit.
But if you expect to at least live an average life span and you don't have a pressing need for money, then delaying your filing could boost your Social Security benefit by a cool 24%. And so, if you have the ability and patience to hold off, you'll clearly be rewarded quite nicely.
The $16,728 Social Security bonus most retirees completely overlook
If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known “Social Security secrets” could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $16,728 more… each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies.
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