By Manuel Tovar, November 10 – Hispanic Solutions Group
As it is known Social Security provides a fixed and secure income to retirees and others, which helps many to face their golden years since they get reliable money for the rest of their life, many people want to maximize their monthly check.
And today we bring you some interesting facts about the topic in general terms to maximize your Social Security income:
- Work longer. The more years you work, the more money Social Security will pay, up to your best 35 years of income.
- Earning more, if you pay more to the Social Security system, your later payment will be higher, up to a point.
- Delay your profit. If you wait longer to claim your benefit, up to age 70, you will claim a higher monthly payment.
But those methods are only part of the story, and those looking for a bigger benefit check have a few other ways to increase their pay. Today we show you the five ways to maximize your Social Security benefits:
1. Work more years
While you can’t always earn a higher salary, you may be able to work longer, and that’s the first step in maximizing your Social Security paycheck. “Social Security benefits are calculated from the 35 years of employment in which your salary was the highest,” says Mark Bodnar, CFP, wealth advisor at Octavia Wealth Advisors in Cincinnati.
2. Make more money
Social Security taxes your wages 6.2% each year, and your employer pays another 6.2%, up to $ 142,800 (by 2021) in income. Paying taxes above the maximum would give you the highest possible Social Security payment, all else equal. So if you pay taxes on the maximum, which tends to increase every year, then you are exceeding your contributions to the system.
For those who paid the maximum taxable amount during their entire working life and claimed all of their benefits at age 70, the initial payment in 2021 would be $ 3,895. This number gives you the upper limit of what they could expect, although that number should grow over time, thanks to adjustments.
3. Delay your profit
Delaying your benefit will increase your benefit check, but there is a limit to its scope. You can begin receiving your Social Security benefit at age 62, although you will receive less than if you waited until full retirement age (age 67, for those born in 1960 or later). If you want the biggest check, you can wait until age 70, but waiting beyond that won’t get you anything extra.
4. Married? Divorced? You have options
Social Security offers many benefits to people in many different settings, and some of the most complex options occur if you are married or divorced. Therefore, spouses and ex-spouses should carefully consider the options and what works best for them, especially in the area of survivor benefits when one spouse dies before the other.
And just because you’re divorced doesn’t mean you can’t claim Social Security benefits on your ex-spouse’s income. But there are specific requirements that you must meet, the existence of a spouse or ex-spouse complicates the planning process and means that you need to model more scenarios to see what maximizes your benefits.
5. Work with a specialized financial advisor
Only 4% of people in the US choose the optimal claim strategy that would earn them the most money over their life expectancy.
For this reason, it might make sense to work with a financial advisor who specializes in claiming Social Security benefits, especially if you are in an unusual situation.
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