Investment Corner: Social Security and your retirement: Maximizing your benefit 

Larry Sidney

This is the second of a 2-part series on Social Security and retirement income. 

Most Americans will start receiving Social Security benefits in the form of monthly payments from the government, beginning between age 62 and 70. This payment is an important piece of many people’s retirement plan. Understanding how to maximize Social Security benefits is essential for securing financial stability during retirement and ensuring the well-being of your family. 

To begin with, we are each assigned a “Full Retirement Age”, or FRA, which is somewhere between age 65 and 67 (you can find that on your recent SS statement.) If you choose to begin collecting Social Security before your FRA, normally as early as 62, you will receive less income each month. If you choose to delay collecting Social Security until after your FRA, up to age 70, you will receive a larger monthly payout. 

Deciding when to claim your Social Security benefit can be complicated. While many people will tell you to delay until age 70 to get the maximum payment, that can be a mistake. A good financial advisor will tell you that many factors should go into the decision, such as: 

  • What are your income needs, and what other income sources do you have? 
  • What is your personal and family situation? 
  • What is your life expectancy? 
  • What is your tax situation? Your Medicare situation? 

There are also some interesting ways in which outside factors can impact your Social Security benefits. For instance, if you plan to work through your 60s, you should know that this income will reduce your Social Security benefit until you hit your FRA. At the same time, however, your earnings from work may actually be increasing your future Social Security benefit, which is a good thing. 

Another outside factor is Medicare. The cost of Medicare depends on your overall income (Social Security plus other income), so that the cost can go up dramatically at higher levels of income. If you collect Social Security before FRA, you will collect for more years but at a lower income level, which for some people will reduce their Medicare costs. Again, this varies depending on your unique situation. 

The final two things I’ll mention on this are “spousal benefits” and “survivor benefits”. If you are married and your spouse qualifies for a much higher Social Security benefit than you do, spousal benefits can provide up to 50% of your spouse’s benefit. And if your spouse has passed away, you as the surviving spouse can claim benefits as early as age 60, or at your FRA for full benefits. 

As you can see, maximizing your Social Security benefits can be complicated. There are online calculators that can be useful aids for this, and many financial advisors and Social Security experts can help you with this as well. At the end of the day, the decision to delay your Social Security as long as possible may make sense, but only once you’ve analyzed the rest of your situation. Given how important this income is to many, I recommend that you take your time and make this decision with care. 

However you choose to prepare for your retirement, invest smartly and invest well! 

Larry Sidney is a Zephyr Cove-based Investment Advisor Representative. Information is found at or by calling 775-299-4600 x702. This is not a solicitation to buy or sell securities. Clients may hold positions mentioned in this article. Past Performance does not guarantee future results. Consult your financial advisor before purchasing any security. 

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