Social Security is a program designed by the federal government to provide you and your spouse with income after retirement. It is a part of social insurance that also benefits disabled workers and their survivors. Although it is overlooked by most people, Social Security is an important part of your retirement plan. As a low-income earner, your social security is quite beneficial and you should never ignore. The amount you can get from social security varies depending on when you start making your payments. Although there’s no way you can change the formula used by the government to calculate the benefits you get, there are ways that can help you maximize them.

Minimize Taxes

• At first, SSA retirement benefits were tax-free but until the 1980s, the federal government began levying taxes on them. Beneficiaries with higher income pay more taxes. In case the sum of your gross income, 50% of your personal Social Security and non-taxable income is over $25,000 and $32,000 (for you and your couple), then it means half of your benefit will be taxed for up to 50%. Additionally, if your total annual income exceeds $34,000 and $44,000 (for couples), then your benefit will be taxed up to 85%.
  
  To maximize your benefits, you need to minimize your modified adjusted gross income. Some of the ways you can consider are to convert traditional IRAs into Roth IRA, reduce your distributions from customary IRA, and time the sale of those assets that have capital gains.

Understand Your FRA

• Your retirement age is very important. The full retirement age for everyone used to be 65 years. The age, however, has been rising steadily. If you were born after 1960, then your full retirement age is 67 years. But if your year of birth is from 1943 to 1954, then your FRA is 66 years. FRA is the baseline for all considerations in Social Security. In case you retire prior to your required age, then your benefits will be decreased by up to 26%. Work until that age that is considered full retirement age by the government.

Delay Claiming

• When you wait past your FRA, then you can receive up to 8% increase in your monthly social security benefits. The worst mistake that most of us do is to rush for cash flows immediately after leaving the job. Some aren’t confident whether they will live past 70. If you claim early, you get less. It pays to do the simple arithmetic.

Earn More

• By raising your income, you stand a chance of receiving more from your Social Security retirement plan. Look for ways to increase your earnings like finding a side job, start a hustle or asking for a salary increment. For instance, in 2019 cumulative earnings of $132,900. The recommended time to work is 35 years. SSA determines the amount of benefit you can get by evaluating your highest-paying years.

Claim the Payment of Your Spouse

• Maybe your spouse received more income than you in your working years. You can take that advantage by applying for both your benefits and part of your spouse’s. SSA allows you to claim up to 1.5 of the retirement benefits of your spouse. They will, however, pay your benefits first before that of your spouse. In case the benefits of your spouse are higher compared to yours, then you can be given an amount that is higher than that of your spouse. It doesn’t matter whether you were married for some time then divorced. You can still use their work history to make claims.

Harmonize Your Starting Dates With Your Spouse

• Your joint benefits can rise significantly when your benefits and that of your spouse are taken as a package. The mistake that most of us do is to leave each one of us to decide when to start. You can only decide to begin at different dates in case there is a huge difference in age. Moreover, in case one of you dies you can maximize your benefits by inheriting their benefits.

Bottom Line

Your taxes, life expectancy, marital status, your retirement age, and your spouse are some of the critical things to consider when seeking to maximize Social Security benefit. Increasing your social security benefits is the best thing you can do to better your after retirement life.