Practical Retirement Guidance: How To Make the Most of Your Social Security Benefits

When to claim benefits based on your personal needs.

Deciding when and how to claim Social Security benefits is one of the most important decisions that retirees will ever make. Social Security benefits represent one of the few sources of guaranteed income that retirees can count on for the rest of their lives. In addition, Social Security benefits are adjusted annually (in most years) to keep pace with inflation. You can claim Social Security anytime between age 62 and 70, but the longer you wait to start benefits, the bigger your monthly benefits will be for the rest of your life.

Rethinking Social Security

While there has been a growing appreciation in recent years for maximizing Social Security benefits by delaying when benefits begin, periods of economic disruption and shifting work patterns have led some individuals to rethink their claiming strategies. Job changes, early retirement, or unexpected income needs can all influence when someone decides to start collecting benefits.

In addition, some people consider claiming Social Security earlier than planned due to concerns about long-term program funding or rising living costs. It is projected that by 2035, payroll taxes will cover only about 78% of scheduled benefits if no changes are made.[1] And although inflation has moderated from recent highs, the impact of future economic conditions, fiscal policy, and potential changes in trade or tax policy can still play an important role in retirement planning decisions.

Deciding when and how to claim Social Security benefits can be complicated, as claiming too early may result in permanently reduced income. Below, we outline key considerations to help you make an informed decision about when to begin receiving benefits.

Your Age Matters

The dollar amount of your monthly Social Security benefit is based on your average lifetime earnings and your age when you first claim benefits. The Social Security Administration (SSA) calculates your average indexed monthly earnings during your top 35 earning years and applies a formula to those earnings to arrive at your basic benefit or “primary insurance amount” (PIA). This is how much you would receive at your full retirement age (FRA), which varies from 66 to 67, depending on your year of birth.

If you claim benefits before FRA, your benefit will be reduced. If you are willing to delay claiming your benefits, up to age 70, they will be larger for the rest of your life. For every month you wait to collect Social Security beyond your FRA you earn delayed retirement credits worth 0.67% per month for a total of 8% per year, up to age 70.

If your FRA is 66, delaying Social Security benefits until 70 will result in a whopping 32% increase in benefits. That means if your FRA benefit is $2,000 per month at age 66 and you wait until you reach 70 to collect, your benefits will grow by 8% per year for four years and be worth $2,640 per month at 70 ($2,000 x 1.32).

The actual payout will be even larger as annual cost-of-living adjustments (COLA) for each of the intervening years between the time you first become eligible for benefits at 62 and the age you claim will be added to your monthly benefit amount. Waiting to collect the biggest benefit at age 70 means future COLAs will be applied to a bigger base, resulting in larger monthly payments for the rest of your life. Delayed retirement credits end when you turn 70, so it makes no sense to postpone claiming Social Security beyond that age.

How Work Affects Benefits

Anyone who collects Social Security benefits before FRA—including retired workers, their spouses, divorced spouses, and survivors — is subject to earnings restrictions if they continue to work while receiving benefits. The earnings cap applies only to wages from a job or net self-employment income, not other sources of income such as investments, pensions, or other government benefits.

If you collect Social Security benefits before reaching full retirement age (FRA) and continue working, your benefits may be temporarily reduced if your earnings exceed annual limits set by the Social Security Administration. For individuals who are younger than FRA for the entire year, Social Security generally withholds $1 in benefits for every $2 earned above the applicable earnings limit.

A more generous earnings limit applies in the year you reach FRA. In the months before reaching your FRA, Social Security typically withholds $1 in benefits for every $3 earned above the higher earnings threshold established for that year. Once you reach your FRA month, the earnings test no longer applies, and you can earn any amount without reducing your Social Security benefits.

Full retirement age depends on your year of birth and has gradually increased over time, reaching age 67 for individuals born in 1960 or later.

For current earnings limits, including the amounts that apply in 2026, visit the Social Security Administration’s webpage: https://www.ssa.gov/benefits/retirement/planner/whileworking.html

Benefits lost to the earnings cap are not gone forever, they are merely deferred. For example, say you claimed retirement benefits at 62 and continue to work. And assume over the next four years, you forfeited 24 months of Social Security benefits due to excess earnings. When you reach your full retirement age, SSA will recalculate your benefits, adding back any months you forfeited because of the earnings cap. For more information, see how work affects your benefits.

Your Marital Status

It’s not just your age and earnings history that can affect your Social Security benefits. Your marital status can also influence your lifetime benefits.

When an unmarried individual claims Social Security benefits, it’s fairly simple. Their benefit is based on their average lifetime earnings and the age when they first claimed benefits. Some married couples have an additional claiming option, as do some eligible divorced spouses, depending on their birth date.

Married couples should coordinate their claiming strategies to maximize benefits while both spouses are alive and to create the largest possible survivor benefit for the remaining spouse after the first one dies.

In general, it makes sense for the spouse with the larger Social Security benefit to delay claiming up until age 70 to maximize the household’s retirement benefit. In the meantime, the spouse with the smaller benefit may want to claim reduced benefits early if he or she is not working or at full retirement age when earnings restrictions disappear. This coordinated claiming approach generates some income initially, helping to take some pressure off the couple’s finances while the second spouse waits until 70 to claim a maximum benefit.

A married individual may be entitled to two Social Security retirement benefits: one on their own earnings record and one as a spouse, which is worth up to 50% of the worker’s FRA benefit. Normally, Social Security pays the larger of the two benefits.

For example, let’s assume a husband’s FRA benefit at 67 is $2,400 per month. A spousal benefit would be worth half of that amount — $1,200 per month — if the wife claimed benefits at her FRA and less if she claimed earlier. Let’s assume she has also earned her own retirement benefit of $1,000 per month.

Assuming the husband and wife each claim Social Security at their FRA, the wife would receive the higher of the two amounts — $1,200 in this case. Her benefit would actually be comprised of two components: her own benefit of $1,000 per month plus the excess spousal benefit amount of $200 per month.

If one spouse has not worked long enough — at least 10 years to accrue the minimum of 40 credits needed to be eligible for benefits — she can still claim benefits as a spouse. But she must wait until her husband claims his Social Security benefit before she can claim a spousal benefit based on his earnings record.

If the spouse with the bigger benefit dies first, the larger benefit — the husband’s $2,400 per month in this example — will continue as the survivor benefit, and the wife’s smaller retirement benefit of $1,200 per month will disappear. The major goal of most couples’ claiming strategy should be based on creating the largest possible survivor benefit.

There is an additional claiming option for married couples where at least one spouse was born before 1954. Once one spouse files for Social Security, the other spouse, who was born before 1954 can file a “restricted claim for spousal benefits” and collect half of the other spouse’s FRA amount while allowing his or her own retirement benefit to continue to grow up until age 70, and then switch to the bigger benefit.

Collect on Your Ex

Divorced spouses who were married for at least 10 years and who are currently unmarried may be able to collect benefits on an ex’s earnings record. Like the married couple in the previous example, if an ex-spouse is eligible for retirement benefits on her own earnings record and as a former spouse, she would be paid the higher of the two amounts.

Also, like the married couple above, an eligible divorced spouse could file a restricted claim for spousal benefits on her ex-husband’s earnings record if she were born on or before January 1, 1954. That would allow her to collect half of her ex-husband’s FRA amount while her own retirement benefit would continue to grow up until age 70 when she would switch to her own maximum benefit. Social Security benefits are gender-neutral. Likewise, an ex-husband born on or before January 1, 1954, could file a restricted claim for spousal benefits on his ex-wife’s earnings record.

When it comes to filing for Social Security, divorced spouses have an added advantage over married couples. A divorced spouse who was married for at least 10 years, has been divorced for at least two years, and who is currently single can claim benefits on an ex’s earnings record even if the ex has not yet claimed benefits (as long as the couple has been divorced at least two years and each former spouse is at least 62 years old). This is known as being an “independently entitled ex-spouse.”

Survivors

Widows, widowers, and surviving ex-spouses have more flexibility than other Social Security beneficiaries because retirement benefits and survivor benefits represent two different pots of money. A surviving spouse or surviving ex-spouse can choose one benefit first and switch to the other benefit later if it results in a larger monthly benefit, regardless of the year of birth.

To be eligible for a Social Security survivor’s benefit, a widow or widower must have been married to the deceased worker for at least nine months at the time of his or her death. An eligible surviving ex-spouse must have been married to the deceased worker for at least 10 years before the divorce.

Survivor benefits may be claimed as early as age 60, or as early as age 50 for surviving spouses with a qualifying disability that began within seven years of the worker’s death. If survivor benefits are claimed at age 60, the benefit is reduced to approximately 71.5% of the deceased worker’s benefit, compared with 100% if claimed at the survivor’s full retirement age (FRA). Survivor benefits reach their maximum amount when collected at FRA.

Unlike retirement benefits, survivor benefits do not earn delayed retirement credits and do not increase by 8% per year for delaying benefits beyond full retirement age, up to age 70.

A widow, widower, or eligible surviving divorced spouse could choose to collect a reduced survivor benefit as early as age 60 and switch to a maximum retirement benefit as late as age 70. But if the survivor benefit is the larger benefit, it may make sense to collect reduced retirement benefits early (subject to earnings restrictions) and switch to maximum survivor benefits at FRA.

If a widow, widower, or surviving ex-spouse waits until age 60 or later to remarry, they can collect a survivor benefit even if they are married to someone else.

Do-Over Options

Anyone has the right to change their mind about claiming Social Security by withdrawing their application (Form 521) within 12 months of first filing for benefits. But there’s a catch. They must repay any benefits they have received as well as any benefit collected on their earnings record by a spouse or minor children with disabilities.

That resets the clock as if they never claimed Social Security, so they will receive a larger benefit when they file at a later date. You can withdraw your application for benefits only once in a lifetime.

If you miss the 12-month window, you have another do-over option. You can suspend your benefits. You do not have to repay any benefits, but the monthly payments you have been receiving will stop, along with the benefits of anyone claiming on your earnings record, such as a spouse or a child. (However, a suspension would not affect the benefits of an ex-spouse). Your benefit will then earn delayed retirement credits of up to 8% per year until age 70.

Bottom line:

You have worked long and hard for your Social Security benefits. If you need money now and want to claim early, go ahead. It’s your money. But if you are thinking about claiming benefits early just because you are concerned that the Social Security trust funds will run dry in the future, think again. If you can afford to wait, you will be rewarded for your patience, locking in a larger guaranteed monthly benefit for the rest of your life.

[1] GOBankingRates. (2025, October 1). What social security could look like in 2035. Nasdaq. https://www.nasdaq.com/articles/what-social-security-could-look-2035