For many Americans, filing for Social Security feels like the finish line of a decades-long marathon. You’ve worked hard, paid your taxes, and now it’s time to claim your reward. But here is the reality: filing for Social Security isn’t just a box to check—it is one of the most significant financial decisions you will ever make.
Once you claim your benefits, you largely lock in that monthly income for the rest of your life. Make the wrong move, and you could leave tens of thousands of dollars on the table. But with a little preparation, you can ensure you get every dollar you’ve earned.
According to the Social Security Administration (SSA), the average retired worker’s benefit rose to approximately $1,976 per month in January 2025 thanks to the 2.5% Cost-of-Living Adjustment (COLA). Whether your benefit is higher or lower than average, the strategies below will help you maximize it.
Here are the five critical steps you should take before you ever submit that application.
1. Audit Your Earnings Record for Errors
Your Social Security benefit amount is calculated based on your “highest 35 years” of earnings. If the SSA has incorrect data—perhaps a missing year of income or a typo in your reported wages—your monthly check could be permanently lower than it should be.
Errors happen more often than you might think. A name change after marriage, a clerical error by an employer, or a transposed digit on a W-2 form can all lead to missing credits.
Action Steps:
- Create or Log In to your my Social Security account: Go to ssa.gov/myaccount. This is the official portal where you can view your statements.
- Review the “Earnings Record” page: Scan your history year by year. Does the income listed match what you actually earned?
- Check for “Zero” years: If you worked in a specific year but the record shows $0, that’s a red flag.
Note: There is generally a time limit of three years, three months, and 15 days after the year in which wages were paid to correct an error, but the SSA makes exceptions if you have proof (like W-2 forms or tax returns). Fix these errors now, not after you file.
2. Stress-Test Your “Break-Even” Age
One of the most common questions seniors ask is, “Should I take the money now or wait?”
- Age 62: You can claim early, but your benefit is permanently reduced (up to 30%).
- Full Retirement Age (FRA): For anyone born in 1960 or later, this is age 67. You get 100% of your earned benefit.
- Age 70: If you wait, your benefit grows by 8% per year between your FRA and age 70. This is a guaranteed return that is hard to find elsewhere in the financial world.
Many people calculate a “break-even age”—the age at which the total money received from delaying equals the total money received from starting early. This is usually around age 80 or 81. If you live past that age, delaying wins.
However, “break-even” math often ignores longevity risk. If you live to 90 or 95, that higher monthly check becomes a crucial lifeline when other savings might be depleted. Frame your decision not just on “getting the most money back” but on “insuring against living a very long life.”
“You don’t get to do a do-over on Social Security. You have to get it right the first time.” — Mary Beth Franklin, InvestmentNews
3. Calculate the “Tax Torpedo”
Many seniors are shocked to learn that their Social Security benefits may be taxable. The IRS uses a figure called “Combined Income” to determine this.
Combined Income Formula:
Adjusted Gross Income (AGI) + Nontaxable Interest + 50% of your Social Security Benefit
The thresholds for taxation are not indexed for inflation, meaning they haven’t changed in decades, catching more retirees every year:
| Filing Status | Combined Income | Taxable Portion of Benefit |
|---|---|---|
| Individual | $25,000 – $34,000 | Up to 50% |
| Individual | Over $34,000 | Up to 85% |
| Married Filing Jointly | $32,000 – $44,000 | Up to 50% |
| Married Filing Jointly | Over $44,000 | Up to 85% |
If you have a 401(k) or traditional IRA, withdrawals from those accounts count toward your AGI. This can push your “Combined Income” over the limit, triggering taxes on your Social Security. This double-whammy is often called the “Tax Torpedo.” Planning your withdrawals before you claim benefits can sometimes help you stay under these thresholds.
4. Coordinate with Your Spouse
If you are married, you shouldn’t view your Social Security decisions in a vacuum. You need a household strategy.
The Survivor Benefit Rule: When one spouse passes away, the surviving spouse generally keeps the higher of the two benefits, while the lower benefit disappears.
If the higher-earning spouse claims early at 62, they are permanently capping the survivor benefit for their partner. By delaying their claim until age 70, the higher earner ensures that the surviving spouse (who is statistically likely to be the wife) will receive the maximum possible monthly amount for the rest of her life.
Did you know? Divorced spouses may also be eligible for benefits on an ex-spouse’s record if the marriage lasted at least 10 years and they have not remarried.
5. Review the “Earnings Test” If You Plan to Work
Retirement today often means a “phased” approach where you work part-time. If you claim Social Security before your Full Retirement Age (FRA) and continue to work, you are subject to the Retirement Earnings Test.
For 2025, the limits are:
- If you are under your FRA for the entire year: The limit is $23,400. For every $2 you earn above this limit, the SSA withholds $1 of your benefits.
- In the year you reach your FRA: The limit is $62,160. For every $3 you earn above this limit, the SSA withholds $1.
Note: Once you reach your Full Retirement Age month, the earnings test disappears. You can earn as much as you want without penalty.
The withheld money isn’t lost forever—the SSA recalculates your benefit at your FRA to pay it back over time—but it can severely disrupt your cash flow today. If you plan to earn significantly more than $23,400 in 2025, it often makes sense to delay claiming benefits.
Costly Errors to Sidestep
Even with the best intentions, seniors often stumble on these specific hurdles:
- Forgetting Medicare Premiums: If you are enrolled in Medicare Part B, the premium is automatically deducted from your Social Security check. For 2025, the standard monthly premium is $185.00. Make sure your budget accounts for this “net” amount, not the gross amount on your statement.
- Ignoring State Taxes: While the federal government taxes benefits, 10 states also tax Social Security to varying degrees (e.g., Colorado, Connecticut, Minnesota). Check your specific state laws.
- Falling for the “Reset” Myth: You have a 12-month window to “withdraw” your application and pay back benefits if you change your mind. After 12 months, your decision is final. Don’t assume you can change it later.
When DIY Isn’t Enough
While many people can handle their own filing, consider speaking with a fee-only financial planner if:
- You have a significant age gap with your spouse: This complicates the survivor benefit strategy.
- You have a government pension: The “Windfall Elimination Provision” (WEP) or “Government Pension Offset” (GPO) could drastically reduce your expected Social Security benefits.
- You have minor children: You might be eligible for additional family benefits.
Frequently Asked Questions
Can I claim Social Security and still work full-time?
Yes, but if you are under your Full Retirement Age (67 for those born in 1960+), your benefits will be reduced if you earn over the annual limit ($23,400 in 2025). Once you hit your Full Retirement Age, you can work as much as you want with no reduction.
How much will my benefit increase if I wait until age 70?
Your benefit increases by 8% for every year you delay past your Full Retirement Age, up until age 70. If your FRA is 67 and you wait until 70, your monthly check will be 24% higher than if you had claimed at 67—and nearly 77% higher than if you had claimed at 62.
Is Social Security fully tax-free?
No. Depending on your “combined income,” up to 85% of your benefits can be subject to federal income tax. Additionally, some states levy their own taxes on Social Security benefits.
Taking the time to review these five areas before you file can result in thousands of dollars in additional income over your lifetime. It transforms a stressful guessing game into a confident, strategic decision.
The information in this guide is meant for educational purposes. Your specific circumstances—including income, benefits, tax situation, and health needs—may require different approaches. When in doubt, consult a licensed financial advisor or tax professional.
Last updated: February 2026. Benefit amounts, tax rules, and program details change annually—verify current figures with official government sources.
