Want your Social Security benefit to be 24% higher? Here’s how to make it happen.

Increasing Social Security can help you prepare for a better retirement. Many people worry about running out of money later in life, but Social Security will last as long as you do. A larger benefit means you’ll be less likely to struggle in the latter part of retirement, even if the balance your investment account isn’t as big as it used to be.

The good news is that it’s entirely possible to increase the amount Social Security pays you in your senior years. In fact, you can get a 24% benefit boost if you want one. Here’s how.

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You can increase your Social Security benefits by 24% if you do this

First, it’s important to understand what your standard Social Security benefit is. Your standard benefit is the amount of income you would receive if you claimed your first retirement check at full retirement age. The FRA varies by year of birth, but is 67 for anyone born in 1960 or later, 66 and 10 months for those born in 1959, and 66 and 8 months if you were born in 1958. The standard benefit you get if you start payments at your designated place FRA is based on a percentage of your income during your 35 highest earning years.

Now, you can increase this standard benefit by up to 24% (if FRA is 67). You can do this by delaying the start of the checks. Social Security aims to give seniors financial flexibility by allowing them to claim benefits at any time between the ages of 62 and 70. The problem is that early filers have reduced standard benefits because they receive more payments over time, and late filers have their benefits. increased because they give up years of income and receive fewer monthly payments over their lifetime.

If you wait until age 70, you are rewarded for the delay by receiving a large increase in your standard benefit. For each month you delay beyond the FRA, you get a delayed pension credit equal to 2/3 of 1% of your benefit value. These credits can be earned up to 70. When you do the math, that’s an 8% annual increase in your pay. So if you wait from 67 to 70 and earn three years of delayed retirement credits, you’ll find yourself with a Social Security check that’s 24% more than what your standard benefit would have been worth if you’d claimed it at FRA.

How can you earn this increase in benefits?

It’s pretty easy to figure out how to get a 24% benefit increase on your Social Security payment. Wait to claim benefits until you reach age 70.

However, in practice this can actually be quite difficult to achieve. After all, most people don’t want to work until they’re 70 or can’t because of health problems or lack of opportunities. If you don’t want to keep working and collecting a salary until you’re 70, but you also You don’t want to start Social Security until you’ve maxed out your benefits with the 24% growth earned at age 70, you have to find a way to support yourself without a job or retirement benefits — probably for a few years.

Having plenty of extra savings in a 401(k) or other tax-advantaged retirement plan is the best solution here. You can live off your savings while you wait for your Social Security benefits to max out. Once they do and you claim them at age 70, you’ll have a lot more money to cover the essentials or leave to your spouse in survivor benefits if you die first.

It’s well worth the effort to leave you and your loved ones with the peace of mind of knowing your benefit checks will be as big as they could be, so you’ll have more guaranteed funds for the rest of your life.