The Single Social Security Move That Adds 24% to Your Monthly Check for Life

When you make your retirement plan, choosing when to claim your Social Security benefits will be one of the most important decisions shaping your future.

Your benefits are protected against inflation, which few other income sources are for most people. And unlike your savings account or many other common income sources, Social Security benefits are guaranteed not to run out while you are alive. You'll continue receiving them as an income source until you pass away.

Since these benefits have these important advantages, making the most of them can help make your retirement much more secure.

Fortunately, there's a simple way to do that. In fact, one key decision could result in your benefits getting a 24% boost.

Here's what it is.

Do this if you want 24% more in Social Security benefits

If you want to earn a 24% increase in your monthly Social Security benefits, there's one key thing that you must do. You must wait until you are 70 to start collecting your first benefit.

Here's why waiting can pay off.

Social Security becomes available at 62, but your full retirement age is later. If you were born in 1960 or later, your full retirement age is 67.

If you start benefits before your full retirement age, they are reduced by a set percentage each month. This reduction can take as much as 30% off the standard benefit you'd be eligible for at full retirement age.

On the flip side, you are rewarded for waiting to start benefits. So if you don't start collecting Social Security until 70 when your full retirement age is 67, you will earn three years of delayed retirement credits. These are earned monthly, but add up to an 8% annual increase and a 24% increase between age 67 and 70.

How much more will you collect in Social Security?

The exact dollar amount of your benefit increase is going to vary depending on what your standard benefit is. If you were on track for a $2,000 standard benefit at full retirement age, for example, you could collect a $2,480 monthly benefit by waiting until 70 instead of claiming at your FRA.

The higher your standard benefit, the more you stand to benefit from waiting until 70 to claim your Social Security.

If, for example, you earned the maximum taxable earnings throughout the period counted in calculating your Social Security benefits, the maximum benefit you could collect at 62 would be $2,969, while your maximum at full retirement age would be $4,152. If you waited until 70 though, the maximum benefit would be a whopping $5,181 per month. Those are all 2026 numbers, and can change over time.

Is it worth waiting until 70 to claim Social Security?

Many people will find the 24% benefit increase is worth waiting for. In fact, studies have shown around 90% of current workers end up with substantially more lifetime income if they delay their claim until 70 instead of starting their benefits earlier.

This isn't necessarily true for everyone. If you are in poor health without a spouse who needs survivor benefits and you aren't likely to live long enough to collect a benefit at 70, or for many years after 70, then you're better off claiming Social Security at a younger age.

Likewise, if you are claiming Social Security spousal benefits instead of retirement benefits, you cannot earn delayed retirement credits, so you don't benefit from waiting after your FRA to claim benefits.

For many people, though, a higher Social Security benefit later will help them achieve more security and will enable them to collect more lifetime Social Security income over time.

How can you wait until 70 to claim benefits?

Unfortunately, for many people, there is a practical problem associated with claiming Social Security at 70. It may not be possible or desirable to work that long.

If you lose your job and don't want to find another one so late in life, if health or family issues stop you from working, or if you're simply tired of having a job and want to quit, you may decide to leave the workforce much earlier than age 70.

The good news is, leaving the workforce and claiming benefits don't have to happen at the same time. If you have saved money for your retirement, you can live on your savings alone for a few years while you wait for your Social Security benefits to grow.

Of course, this will require planning to ensure you have enough money invested to support you at a safe withdrawal rate as you wait for Social Security to come in. It's worth making the effort to try to do that, though, so you can earn a 24% boost to your Social Security check.

Bottom line

If you want to make the right moves to set yourself up for a secure retirement, creating a plan to delay your Social Security claim until 70 is a good place to start. This single decision could give you 24% more inflation-protected income that's guaranteed for life. That's a lot of extra money to help you stay financially comfortable in your later years.

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