3 Hidden Social Security Loopholes Retirees Should Know About

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There are millions of retired seniors today whose sole source of income is Social Security. Of course, that’s not an ideal situation. With the average retired worker benefit coming to just under $2,000 a month, that’s not a whole lot of money to live on.

But even if Social Security isn’t your only source of retirement income, it stands to reason that you’d want your benefits to be as generous as possible. And you may not realize it, but there are a few hidden loopholes in the program’s rules that could make it possible to snag larger monthly checks. Here are three you should know about.

1. Delayed retirement credits

The Social Security benefit you’re eligible for as a retired worker hinges on your 35 highest-paid years of income. Beyond that, your filing age will determine how much money you get.

You can sign up for Social Security starting at 62, but you’ll need to wait until full retirement age (FRA) to get your monthly benefit without a reduction. However, you don’t actually have to file for Social Security at FRA.

Delaying Social Security past FRA actually boosts your benefits by 8% per year in the form of delayed retirement credits. And any increase to your benefit you receive by waiting is a permanent one.

Once you turn 70, you can no longer rack up delayed retirement credits, so 70 is typically considered the last or oldest age to sign up for Social Security. But sitting tight until then could put a lot more money in your pocket on a monthly basis.

2. The do-over option

A lot of people claim Social Security before FRA to get their money sooner and then regret it upon seeing how much their benefits have shrunk. But you should know that even if you’ve claimed Social Security, there’s a way to increase your benefits.

It’s called the do-over option, and every Social Security claimant gets one in their lifetime. What it allows you to do is withdraw your application for benefits, repay the Social Security Administration the benefits you’ve received to date, and then file for benefits again at a later point in time.

Withdrawing and postponing your claim allows your monthly benefits to grow, so this move could result in much larger monthly checks. Just make sure to take advantage of it within 12 months of your initial claim. Otherwise, it may be off the table.

3. The option to keep working while getting benefits

Another way to increase your monthly Social Security checks after you’ve claimed benefits is to continue working. This isn’t guaranteed to raise your benefits, but it could.

As mentioned earlier, your Social Security benefits are based on your highest-paid 35 years in the workforce. But if you’re missing an income for any of those 35 years, it’ll result in smaller benefits.

If you work even part-time while collecting Social Security, you’ll replace some years of zero income with an actual wage, which could lead to more generous benefits. And rest assured that you are allowed to earn money from a job while collecting Social Security. You’ll just need to be mindful of certain income limits if you’re doing so before reaching FRA.

In that case, earning too much could result in withheld benefits you get back later. And if you give your income a large enough boost, your future Social Security checks could be significantly higher.

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