3 Silly Reasons You’re Losing Out on Social Security Income

You’ll often hear that Social Security shouldn’t be your only income source in retirement but rather, one of several. That’s because those monthly benefits won’t come close to replacing your preretirement earnings in full. And if you want the freedom to pursue hobbies, travel, and do other fun things as a retiree, you’ll probably need access to more money than what Social Security will pay you.

But even though Social Security shouldn’t constitute your only retirement income source, it could still end up being an important one. And that’s why it’s essential that you get as much money out of the program as you can. So consider these three reasons you could end up losing out on benefits — and kicking yourself for it.

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1. You’re claiming benefits early because you don’t know your full retirement age

The amount of money Social Security pays you every month in retirement will hinge on your personal wage history. And you’re entitled to that benefit once you reach full retirement age, or FRA. FRA is either 66, 67, or somewhere in between, depending on the year you were born.

Many people, however, claim Social Security early because they don’t realize when FRA kicks in. See, you’re allowed to sign up for benefits as early as age 62, but for each month you claim Social Security early, those benefits get reduced.

You may think your FRA is 65 since that’s when Medicare eligibility begins. But if you claim Social Security at 65, you’ll end up with a lower monthly benefit — for life.

2. You’re delaying your filing past age 70

You’re not required to sign up for Social Security once you reach FRA. Rather, you can postpone your filing and accrue delayed retirement credits up until the age of 70. Those will result in a boost to your benefits that will remain in effect for the rest of your life.

But some seniors don’t realize that Social Security benefits can’t grow beyond age 70. And if you delay your filing beyond that point, you could risk shorting yourself on money you were otherwise entitled to.

3. You’re delaying a spousal benefits claim

As mentioned, the Social Security benefit you’re eligible for every month in retirement will hinge on your earnings history. But if you never worked and therefore don’t have an earnings history, you can still collect benefits if you are or were married to someone who’s eligible.

That said, unlike benefits claimed on your own earnings record, Social Security spousal benefits can’t grow. As such, there’s no sense in delaying a spousal benefit claim beyond FRA. And if you do, you’ll simply deny yourself money you were entitled to collect earlier.

Know the rules

Avoiding these silly Social Security mistakes boils down to one key thing: knowing how the program works. It pays to spend some time reading up on Social Security so you land in a position to maximize your benefits without falling victim to blunders like these that cost you money.

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