Social Security recipients will get a small bump in their monthly checks next year.
But if you still have a few years left until you start collecting, we’ve got some strategies for you to maximize the monthly check you will eventually collect!
Tiny COLA hike is coming
After a couple years of almost no inflation, the Social Security Administration (SSA) is expecing a .02% increase in monthly payments going forward, according to The Wall Street Journal.
It’s set to be the smallest hike—in years when there is a hike at all—since the mid-1970s. Recipients have a slight firming up of the nation’s inflation to thank for the cost-of-living adjustment (COLA) in 2017. (Hikes generally come in relation to inflation; in years when there is no inflation, there is no increase in benefits.)
The average monthly Social Security check in December 2015 was $1,342, according to the SSA. So the .02% increase next year is expected to be roughly an extra $2 to $6 in your check each month. That’s not a lot of money. But for the 47% of single elderly people who depend on that monthly check for 90% or more of their income, at least it’s something.
How can I beef up future checks before I start collecting Social Security?
If you have some time left before you start claiming your Social Security benefits, consider the following:
Play the waiting game
In the past, it was very common to retire and take Social Security at 62. But every year you wait after 62, you have an imputed return of 8% per year on your lifetime benefit. So if you wait from 62 to 70, the amount that Social Security pays climbs dramatically. (Benefits no longer increase after 70.)
Use an online calculator to help!
AARP’s interactive calculator allows you to pop in your specifics and it will give you a decision tree to help you figure out the optimal time to take Social Security. Check it out to help yourself or a parent.
If you are looking for a more comprehensive approach to give you specifics on when it would be best to start drawing on your Social Security benefits, check out Maximize my social security. There are different levels of analysis that you can choose, but $40 gives you access to sophisticated software that helps determine the best time to start receiving your checks. They also offer a money-back guarantee if you aren’t satisfied.
Don’t forget the spousal benefits
Even if he or she has never worked under Social Security, your spouse may be able to get benefits if he or she is at least 62 years of age and you are receiving or eligible for retirement or disability benefits. He or she can also qualify for Medicare at age 65. More info about spousal benefits is available at SSA.gov.
Now that we’ve told you about claiming under your spouse’s Social Security number, did you know you can also claim under your Social Security number too? “Dual-earner couples who have reached their full retirement age can claim spousal payments and file again later based on their own work record, which will then be higher because they accrued additional delayed retirement credits,” according to U.S. News & World Report.
Boost your earnings today
What you get from Social Security has everything to do with your 35 highest earning years. So you might consider negotiating a raise or taking on a second job, says U.S. News & World Report. Clark help you on the latter front. His Work from Home guide has legitimate ways you can earn some extra money. None of the sites listed will make you rich, but they will help you supplement your existing income.