To qualify for any amount of Social Security retirement benefits, you need to work for at least 10 years or earn 40 quarters of credit. While some workers may be eager to retire at age 62, retiring early is not often the best option if you want to get the most out of the Social Security benefits you will receive. Fortunately, there are ways in which you can get a higher payout and increase your income from this source.
Step 1
Work until you reach full retirement age or longer if your health allows. Since Social Security retirement benefits are based on the 35 highest earning years a person has in the workforce, earning more at your job in your 50s and 60s can increase your benefits. What you are actually doing is canceling out some of the years when you were younger and earned less money working. No matter at what age you decide to retire, try to work at least 35 years.
Step 2
Delay claiming your benefits. Applying for retirement benefits at a younger age means that you will receive smaller payments over a longer period of time. Retirees who begin claiming Social Security retirement benefits at age 62 see 25 to 35 percent less each month than if they waited until full retirement age to apply. Individuals who postpone retirement can see their monthly benefit checks increase by about 8 percent for each year they delay until age 70.
Step 3
Sign up at age 62 if your spouse also works and earns more income. Couples can usually increase their total payout if the lower wage earner signs up early and the higher wage earner delays claiming benefits, preferably until age 70. Typically, a married woman is the lower wage earner in the household while the husband usually earns more and may be a few years older than his wife.
Step 4
Begin collecting your Social Security retirement benefits at age 62 and then invest the money. According to Andrew Biggs, a former deputy commissioner of the Social Security Administration, if you apply for benefits early and choose careful investments, you have eight years to pay back the benefits you receive. That way you can keep any interest your investments have earned in addition to getting a higher Social Security payout when you turn 70.
Tips and Warnings
- Single women should delay claiming Social Security retirement benefits as long as they can so that they receive a higher payout.
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