Use Your Social Security to Earn More in 5 Simple Steps

Few Americans have enough saved for an emergency — and much less for retirement. The median retirement savings for a total household is roughly $57,000 among full-time workers. The amount is barely enough to cover average expenses for one retired individual for a single year. What about the next 15 to 20 years after retirement?

Luckily, even Americans with no retirement savings are covered through Social Security — 96% of American workers, to be exact. While it’s still advisable to plan early and regularly contribute towards your retirement in the form of a 401(k) or Roth IRA, it’s reassuring to know you have some retirement income you can count on through Social Security disability. And if you play it smart, you can maximize your asset to make the most of it in the future.

How does Social Security work?

As you work throughout your life, a portion of your paycheck is contributed towards the federal Social Security fund and managed on your behalf. When you reach the age of 67, you can collect monthly payments based on how much you earned and contributed towards the system.

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Many people don’t think of SS as an asset, but the guaranteed income is definitely one. It’s a unique asset — its value decreases as returns increase. It’s important to know how to leverage what you’re entitled to. Also, the fund is managed to account for inflation.

Think of it this way — $100 per month went a lot further 20 years ago than it does today and in another 20 years. Rest assured, the funds will adjust to account for inflation so your payouts keep up with the current cost of living, whatever it may be. Wondering how to get the maximum Social Security benefit? Consider the following five ideas.

1. First, delay your retirement

Although Social Security benefits are generally available once you reach the age of 67, you can collect them as early as 62. It’s not mandatory to collect at these ages. In fact, you may want to wait. The longer you delay receiving benefits, the more you’ll receive in monthly payments.

Christopher Berry of Castle Wealth Group explains, “Claiming Social Security at the wrong time can cost hundreds of thousands of dollars of benefits over a lifetime.” If you choose to collect at 62, your checks will be 28.3% less than if you had waited to turn 67. If you were due $1,000 per month at 67, that’s $283 less per month as long as you live. ”In most cases, it makes sense to wait until you are 70 years old,” he says.

The Social Security administration encourages workers to delay retirement until at least 70. If you do, they’ll pay you an additional eight percent in benefits for every year you wait.

2. Time your benefits

Based on this information, you might want to time your benefits. If you can save enough to cover at least five years of living expenses at retirement, it will push back your Social Security so you can collect the maximum amount. 

[ Read: Roth IRA vs 401(k)? You May Not Have to Choose

To time your benefits properly, you’ll need to decide when you’d like to retire, create a budget of how much you’ll need each year in expenses (without SSI) and contribute money regularly to a tax-deferred IRA or 401(k) to hold you over long enough before you opt for Social Security benefits.

3. Work until your full retirement age

You can also opt to work longer and put off receiving SS. It’s not an unusual idea. In a study by TD Ameritrade, the brokerage firm found that two-thirds of Americans plan to keep working into their late sixties and a half in their seventies. 

There are many reasons why. Some have no choice because they didn’t sufficiently save for retirement. Others don’t want to give up their employer-sponsored health benefits. But many are simply in good health and enjoy their work. Pushing back retirement will pay off in the long run.

4. Include your spouse or a family member

Teaming up with your spouse is a great way to increase your benefit. This technique is beneficial if you didn’t earn as much as your spouse over your lifetime. Social Security rules allow you to collect up to half of your spouse or partner’s full retirement benefit when you reach retirement age. 

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The rule applies even if you’re divorced or a widow. But as with your own benefits, the sooner you start collecting, the less you’ll receive. Wait until age 65 to get the full 50%.

5. Minimize social security taxes

Social Security income is taxable. You may need to pay income tax if you receive a combination of SS and other retirement sources if they push you past the tax threshold. The current threshold means:

Retirement Benefits 
You’ll pay tax on 85 percent of your Social Security benefits if your income is over $34,000 or over $44,000 if filing jointly.
You’ll pay tax on 50 percent of your Social Security benefits if your income is between $25,000 and $34,000 or $32,000 to $44,000 combined if filing jointly.

Knowing this long before retirement can help you plan. Some ways you can minimize taxes on your benefits include:

  • Setting up a Roth IRA so you pay taxes when you contribute the funds and not when you retire
  • Consider withdrawing more from your retirement account before receiving Social Security
  • Monitor the income you draw on from other sources when you start receiving SS checks to stay out of the taxable threshold

Social Security benefits checklist

The key to getting the most out of your guaranteed benefits is to understand how Social Security works and plan ahead. Here’s a Social Security to-do list.

  • Set a retirement age.
  • Push back receiving benefits until you’re 70 to get the maximum payout amount. 
  • Start contributing towards retirement by opening an IRA and/or by participating in your workplace’s 401(k) plan.
  • Review your SS benefit statement when it arrives in the mail to know how much you’ll receive.
  • Compare your benefits statement to your spouse’s to determine if either of you are better off receiving spousal SS, which is 50% of the higher-earning spouse’s benefits.
  • Use the online SSA retirement planning calculators to help you decide which age may be best for drawing benefits and how much money you may need at retirement.
  • If you have other forms of retirement income besides SSI, keep an eye on your taxable threshold or you’ll have to pay income taxes on 50% to 85% of your benefits.
  • Consider opening a Roth IRA if you’re worried about taxes in retirement — you’ll pay tax upfront when you contribute to a Roth IRA instead of when you draw at retirement.
  • Look for work you enjoy or a side business you can operate in your retirement years to delay receiving SS income.

Assets require maintenance and planning to make the most of them.  Many people don’t see Social Security as an asset, but it is. Funds are set aside over your lifetime of work to ensure you have a guaranteed stream of income each month at retirement. 

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Cynthia Paez Bowman

Contributing Writer

Cynthia Paez Bowman is a finance, real estate and international business journalist. Her work has been featured in Business Jet Traveler, MSN,, and

She owns and operates a small digital marketing and public relations firm that works with select startups and women-owned businesses to provide growth and visibility. Cynthia splits her time between Los Angeles, California, and San Sebastian, Spain. She travels to Africa and the Middle East regularly to consult with women’s NGOs about small business development

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  • Andrea Perez
    Andrea Perez
    Personal Finance Editor

    Andrea Perez is an editor at The Simple Dollar who leads our news and opinion coverage. She specializes in financial policy, banking, and investing.