7 Ways to Maximize Your Social Security Benefits

Understanding Social Security is important to get the most out of your benefits. Many people don’t know how it works, so they might miss out on the extra money they could get. How much you receive depends on how much you’ve earned, how long you’ve worked, and the taxes you’ve paid into Social Security.

These things can make the benefit amounts different for everyone. In this article, we’ll discuss simple ways to increase your benefits so you can ensure you’re getting everything you’re supposed to.

BOOST SOCIAL SECURITY BENEFITS

1. KNOW HOW MUCH YOU’RE ENTITLED

Knowing how much social security taxes you’ve paid helps determine how much benefits you can claim. The Social Security Administration (SSA) now has an online platform where you can check your social security credits.

If you’re unfamiliar with the term, social security credits are the points you earn when paying social security taxes. In 2021, you can earn one credit for every $1,470 of earnings. But this amount changes annually, and you can only earn up to 4 credits yearly.

To know how many credits you’ve accumulated thus far, log in to their site and create an account. Once done, you can use it to view your social security records, including your earnings history and estimates of your benefits.

2. BE THOROUGH AND SPECIFIC WHEN APPLYING

When you apply for disability benefits, the SSA will ask you to complete a form disclosing your injury. The information you declared there will be used to determine your eligibility.

If the SSA deems that your medical condition doesn’t meet their criteria for disability, your application will be denied. Or if you fail to declare the true extent of your injury, they might think your condition isn’t that severe. As a result, your benefits could be way less than what you are eligible for.

Thus, being thorough and specific in your application is essential in maximizing social security benefits. Avoid vague answers like “I feel pain in my foot” or “My hands feel numb.” Add more details, such as “The pain in my left foot prevents me from walking or running.”

If possible, ask for the help of your treating physician. They’ll be able to describe the extent of your injury more accurately.

3. COMPARE BENEFIT OPTIONS

Disabled workers aged 62 to 66 years old have the option to avail themselves of either disability or retirement benefits. But if your financial advisor hasn’t told you yet, availing of retirement before you are 66 years old can reduce your benefits. The younger you retire, the fewer social security benefits you’ll receive. This is why some retirement planning advocates are advising against it.

Disability benefits, on the other hand, do not change no matter what age you apply. If you’re already receiving disability benefits, it will automatically convert to retirement once you reach full retirement age. So calculate and compare which benefit option will give you a bigger payout.

4. LIST DOWN YOUR DEPENDENTS

Children below 18 are eligible for up to 50% of their parent’s social security benefits. The same goes for those who become disabled before the age of 22. And even if your child is already 18, their benefits will continue if they are still in elementary or secondary school.

With these, we can’t stress how important it is to list all your qualified dependents to maximize your benefits.

5. MINIMIZE TAXES

Social security benefits form part of your taxable income. If you file taxes as an individual, you will pay taxes if your income is over $25,000 per year. Married couples who file jointly will pay taxes for a combined income of more than $32,000.

Calculate your annual income, including your social security benefits, to minimize your taxes. If you’re married, include your spouse’s annual revenue along with his/her benefits (if any). Use this data to determine which option will help you pay less taxes on your benefits. This financial calculator will help determine how much taxes you’ll pay on your social security income.

6. EXPLORE ADDITIONAL BENEFITS

Most of those who are eligible for disability benefits will also qualify for other additional benefits. Some of the benefits you might be eligible for are:

• Spousal Benefits
• Survivor Benefits
• Parent’s Benefits
• Children’s Benefits
• Veterans Benefits
• SSI
• Medicaid
• Supplemental Nutrition Assistance Program (SNAP)

Several state assistance programs are also available for low-income families. To learn more, check with your local state welfare office.

You also have to explore what benefits you can get out of your life insurance or disability insurance (if any). If you have a Roth IRA, you can check this guide on how to maximize it.