There are millions of retirees in the U.S. that could potentially see their Social Security checks increase by over $1,000 per month, thanks to recent Cost-Of-Living Adjustments (COLA) and delayed retirement benefits. It must be noted that there are many seniors who may miss these higher payments as a result of a simple rule. It is important to understand how Social Security works and how timing plays a role in benefits.
The Big Boost: What’s Causing the Increase?
There are multiple factors that contribute to this monthly increase in Social Security payments:
- Every year the Social Security Administration (SSA) makes adjustments to benefit payments to keep up with the rising costs of inflation. These COLAs help ensure retirees don’t lose buying power as prices rise.
- Many retirees who wait beyond the full retirement age which is typically between 66 and 67 can significantly boost their monthly check. For every year you delay claiming Social Security up to age 70, your benefit increases by about 8%.
- Recipients must note that Social Security benefits are based on your highest 35 years of earnings. People who worked longer or earned more in those years can expect larger checks.
Who Qualifies for the $1,000+ Increase?
Retirees must note that not everyone will receive such a massive increase, those who qualify are:
- Those retirees who waited until age 70 to start claiming benefits
- All those who had high incomes during their working years
- Recipients who benefited from the most recent COLAs
It’s important to note that these higher payments are not “bonuses”, they’re based on calculations tied to your earnings and claiming age. So while the average monthly benefit in 2024 is around $1,900, some retirees who fit the right profile can get $3,000, $4,000, or even more.
The Simple Rule That Could Make You Miss Out
The earliest you can claim is age 62, but doing so comes with a penalty. Your monthly check could be reduced by up to 30% compared to waiting until your full retirement age. If you claim at 70, you get the maximum possible benefit, but many people don’t wait that long.
Why? Some may not know about the benefit of waiting. Others might feel they can’t afford to delay because they need the income. But if you’re in good health and expect to live into your 80s or 90s, delaying can pay off in the long run.
Why Timing Matters More Than You Think
Claiming Social Security isn’t just about when you can start — it’s about when you should. Think of it like this: if you wait a few years, your monthly check could increase by hundreds of dollars — every month, for the rest of your life.
Let’s say you’re entitled to $2,000 a month at full retirement age. If you wait until 70, your check could jump to around $2,640. That’s $640 more each month, or $7,680 a year. Over 20 years, that’s more than $150,000 in additional income.
What Seniors Can Do Right Now
- If you’re approaching retirement or already retired, it’s not too late to make smarter choices about your benefits:
- Review your Social Security statement: This shows what you can expect at different claiming ages.
- Talk to a financial advisor: They can help you decide the best time to claim based on your personal situation.
- Look at your overall retirement plan: Consider how Social Security fits in with savings, pensions, and other income sources.
A simple decision when to start claiming Social Security can mean the difference between a smaller check and an extra $1,000 every month. The good news? With the right knowledge and planning, many retirees can take steps to get the most out of the benefits they’ve worked for their whole lives.