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Social Security and You: Social Security maximizing madness
Social Security and You

Social Security and You: Social Security maximizing madness

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Every week, I probably get a dozen emails from readers who tell me they want to “maximize” their Social Security benefits. So many senior citizens are absolutely obsessed with the notion that there is some secret to getting more money from Social Security that they don’t know about.

As I’ve explained hundreds of times in this column, the alleged “secret” that so many financial planners will dangle in front of you is this: Wait as long as possible before claiming any Social Security benefits. And as I’ve also discussed many times in this column, that may be good advice for some, but not for everyone.

Still, all this talk about “secrets” and “maximizing your Social Security” has almost all senior citizens totally fixated on this idea that they are missing out on something or that they will make a mistake when it comes to deciding when to start their Social Security benefits.

In many ways, this makes me pine for days gone by. Back when I was taking Social Security claims several decades ago, no one worried about this. Most senior citizens generally filed for their Social Security benefits at 62, and they didn’t bat an eye or worry one little whit about their decision.

I’m not necessarily saying that was a good thing. Obviously, it makes sense to plan for your retirement, consider your Social Security options and make a decision about when to start your benefits based on the planning you’ve done.

But my point is this: Don’t obsess about it. Almost no one who contacts me fretting about his or her Social Security choices is between a rock and a hard place, financially speaking. When it comes to Social Security, they are between a pillow and a soft place.

No matter which way they choose to go with their Social Security start date, they will come out OK. Here are some examples of the emails I get from stressed seniors. (Oh, by the way, I am coming at this from only a Social Security perspective. You would also have to consider the tax implications to your decision.)

I am 66. I would really like to start my Social Security benefits now. According to my latest estimates, I’d be due $2,660 per month. But my financial planner tells me I should maximize my benefits by waiting until I am 70. I just don’t know what to do. I’m so afraid I’ll make the wrong decision. Can you help?

A: I can help by telling you this: Don’t worry; be happy. No matter which way you go, it sounds to me like you will be pretty comfortable — Social Security speaking.

If you wait until age 70, you will get an extra 32% added to your benefits. So, you would get about $3,511 per month. That’s $851 more than you’d get if you start your benefits now. But of course, by waiting until 70, you would have lost out on 48 Social Security checks, totaling $127,680. So, do you want the $127,680 pillow? Or do you want the soft place down the road with the extra $851 per month? Pick one. As I said, you really can’t go wrong.

I recently filed for my Social Security at age 70. I let the Social Security agent talk me into taking a six-month-back paycheck. So, I got the big check, but I didn’t understand the consequences of my actions. And now I am not getting my maximum Social Security benefit. I’m getting less. I’m losing sleep over this. Can I go back to the SSA and tell them I’ve changed my mind?

A: Sure, you can do that. But think about it. Do you really want to? I mean, what’s the big deal about getting that so-called maximum benefit?

You didn’t give me money amounts. But let’s say your age-70 rate would have been $3,200 per month. For each month you start benefits before age 70, you lose two-thirds of 1%. In other words, by taking six months’ worth of retroactive benefits, you lost 4%. So, your monthly rate would be about $3,072, or $128 less. But you gained a back paycheck for $18,432.

So, like the person in the first question, you must decide. In your case, do you want the $18,432 pillow? Or do you want a soft place with the extra $128 per month?

I’m 66 and retired. I could use the money, but I want to make sure I maximize my Social Security, so I plan to wait until 70. My wife, who has always made less money than I have, is 62 and retired, and she wants to file for her Social Security. But I’m suggesting she wait until 70 so we both can maximize our Social Security. She says you don’t agree. So, what do you say?

A: If you dig out the column I wrote just two weeks ago, you will see that I answered a question from a couple who has a situation almost identical to yours. They gave me their potential benefit amounts, and I ran the numbers for them; it looked like they would come out ahead if the wife filed for her reduced retirement benefits at age 62 and then later, once her husband filed for his benefits, applied for extra spousal benefits on his record.

In other words, your wife could file for her reduced retirement benefits now. She’d get about 75% of her full benefit. Then when you turn 70, you will start getting 132% of your own benefit. And at that time, your wife can file for spousal benefits on your record to supplement her own retirement benefit. Here is roughly how they will figure out what she would be due on your account: They will take her full-retirement rate and subtract that from one-half of your full-retirement rate (not your age-70 rate). The difference will be added to her reduced retirement benefit.

I’m 82, and my wife is 80. We both took our Social Security when we were 65. I hear all this talk about maximizing our Social Security. Are we missing out?

A: You are not missing out on anything. You are already getting the most from Social Security that you are due. All this “maximizing Social Security” mumbo-jumbo is aimed at folks now nearing retirement age. You can ignore it.

If you have a Social Security question, Tom Margenau has the answer. Contact him at

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