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3 Overlooked Ways to Boost Your Social Security Income

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According to a study by the Transamerica Center for Retirement Studies, nearly 40% of baby boomers will rely on their Social Security benefits as their primary source of income in retirement.

With so many Americans counting on that monthly income to survive, it’s important to make sure you are collecting the highest benefit you possibly can.

Here are 3 overlooked ways you can boost your monthly social security income.

1. You Can Collect Social Security Even If You Didn’t Work The Full 35 Years

Typically, your Social Security benefits are based on the 35 highest-earnings years of your career. Then, you adjust the income you earned for inflation. However, if you haven’t worked a full 35 years, zero income will replace any missed years. You need this to calculate your benefits. While this reduces your benefits, it means you can still qualify for Social Security.

Many Americans assume they won’t qualify for benefits because they worked far fewer than a full 35 years. For example, women who entered the workforce and then dropped out to raise a family can still qualify for monthly benefits. The cutoff for benefits is 40 credits, which equals 10 years of work. So if you worked at least 10 years and then stopped working altogether, you should still file for benefits. You likely won’t collect much, but every bit helps.

2. Not Collecting All The Benefits You Are Entitled To

Most people think Social Security benefits are just monthly retirement income. But there is much more to the program, including spousal benefits, divorce benefits and survivors benefits.

If your married spouse was the breadwinner in the family and is now eligible for Social Security benefits, you may be eligible to collect what are known as spousal benefits. If eligible, you could collect up to 50% of the amount your spouse can receive at full retirement age.

Also, if you are now divorced and haven’t remarried, if your ex-spouse is entitled to benefits, you may be eligible to claim divorce benefits based on their work history as long as you two were married for at least 10 years.

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Most importantly, these benefits can stack on each other. So If you’re eligible for Social Security benefits based on your own work history, the Social Security Administration will pay out your benefits and then add to it any benefits that you’re entitled to, such as spousal or divorce benefits.

If you are a widow or widower over the age of 60 you may be eligible for survivor benefits, but children, parents, and other family members that were financially dependent on the deceased individual may also be eligible to claim these benefits.

3. Consider Tax Implications Of Where You Live In Retirement

The federal government is still going to want their cut of taxes on your benefits. So when you consider where you are going to live in retirement, take into account the various tax laws in each state. You can’t do much to avoid federal taxes. Your “combined income” is the basis of the amount you owe. It is half of your annual Social Security benefit plus any additional income you earn. But for state taxes, some states won’t tax your benefits at all. This lets you keep more money in your pocket.

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