Boost Your Social Security Benefits with These Four Strategies: Essential Tips for Retirees!

Social Security benefits are essential for around 66 million Americans to cover their daily and monthly expenses when they retire. However, the monthly checks are not always substantial, and there are certain measures retirees can take to increase their benefits. Here are four Social Security strategies to help retirees bankroll their retirement, according to a report by Bram Berkowitz of The Mootley Fool published on March 18, 2023.

Firstly, retirees must have worked for at least 35 years to claim their full benefits. The Social Security Administration (SSA) calculates the primary insurance amount (PIA) based on the number of years worked and paid Social Security taxes. The SSA considers the earnings of the top 35 years to calculate the PIA, and a year without earnings will drastically reduce the benefits. Therefore, having 35 years of earnings is essential.

Secondly, increasing earnings throughout one’s career can lead to higher benefits once retired. The SSA calculates the PIA by looking at the top 35 years of earnings, so it is important to stay motivated throughout the career.

Thirdly, delaying Social Security benefits until the age of 70 can increase benefits by 8% per year. In contrast, claiming benefits at age 62 results in a 30% reduction in benefits.

Lastly, it is essential to understand Social Security tax laws to save oneself as much as possible by lowering Social Security taxes. An accountant can be helpful in learning about these laws and strategies such as Roth IRAs and donating required minimum distributions to reduce taxes.

Overall, retirees should focus on having at least 35 years of earnings, maximizing their earning potential, delaying Social Security benefits, and understanding Social Security tax laws to increase their Social Security benefits.