Retirement Tip: Boosting your Social Security

A Simple Tip to Boost Your Social Security Checks

The average retiree currently receives just $1,177 in Social Security benefits per month. Which works out to about $36.72 each day. That's way less than holding down a minimum-wage, full-time job.

It's a sobering thought...

But this number isn't set in stone. Which is important because if you're going to be receiving a pension, or have even modest savings for retirement, there's one step you can take to boost your Social Security payouts by as much as 25%.

Simply delay collecting benefits.

You may be aware that the longer you wait to collect Social Security benefits, the higher your payout will be.

But you may not know that for each year you hold off on claiming Social Security, your benefit could increase by as much as 8% per year.

There are some caveats, of course: You can't delay past age 70, and the annual rate of increase depends on the year in which you were born. But here are the specifics:

Year of Birth	Yearly Rate of Increase	Monthly Rate of Increase
1933-1934	5.5%	11/24 of 1%
1935-1936	6.0%	1/2 of 1%
1937-1938	6.5%	13/24 of 1%
1939-1940	7.0%	7/12 of 1%
1941-1942	7.5%	5/8 of 1%
1943 or later	8.0%	2/3 of 1%
Note: If you were born on January 1st, you should refer to the rate of increase for the previous year. Source: U.S. Social Security Administration

And you can delay even after you retire from your current job.

It's easier, of course, if you've got a pension coming in, a decent-sized portfolio or savings account you can draw down on, or you're planning to pick up a part-time job to stay busy.

But even if you don't want to work for a paycheck ever again, many retirement experts advise that it's actually better to live off of retirement savings for a few years and delay Social Security than to immediately claim benefits and let your savings grow.

After all, an 8% annualized gain isn't something you can guarantee in your brokerage account. But each year you delay taking your Social Security benefit, you are locking in an 8% return.

There's one exception: Dallas Morning News columnist Scott Burns summed up a recent study by the Center for Retirement Research this way, "Married women should take Social Security benefits early. Married men and single women should take Social Security benefits late."

Why is this?

Because married men earn more over their career on average, their Social Security benefit tends to be higher.

Furthermore, women tend to outlive men and widows can receive half of their spouse's Social Security payment if it is higher than their own. So if you're married, this is often a smart move you can make to benefit both you and your spouse.

If you're still not convinced Social Security will be enough...

Unfortunately, you're right. Social Security should ideally just be a portion of your retirement plan. And like I said earlier, the only person you can trust to provide a wealthy retirement is yourself.

So if you're still working, it's time to become 100% laser-focused on building a rock-solid portfolio of your own -- large enough for your own circumstances that you'll be comfortable in retirement.

I'd like to empower you to achieve this end, so contact me if you have any questions!