Alert
Close

Chat retirement strategies with AARP’s Jean Setzfand today, Oct. 24th, at 2:00 p.m. ET

Highlights

Open

You and Your Town Contest-You could win an AARP RealPad
Introducing RealPad by AARP
AARP Auto Buying Program

AARP-iPad-ePub-app

Most Popular
ARTICLES

Viewed

Free Fun!

AARP Games - Play Now!

Work
PROGRAMS

Best Employers for Workers Over 50

See the latest winners of this AARP recognition program.

Employer Resource Center

Attract and retain top talent in a changing workforce.

Little-Known Strategies Could Boost Your Bottom Line

Increase your Social Security benefit.

With the economy in a tailspin and people having to work longer to make ends meet, it’s more important than ever to think through just how and when you claim Social Security benefits. You may be able to boost the amount you receive each month by employing two little-known strategies, described here.

These two approaches are available only if you’ve reached full retirement age—66, gradually increasing to 67. They are not widely used, so far. One reason is that most people begin claiming Social Security at the earliest eligible age, 62—before full retirement age—and that reality has spiked in recent months as people face financial pressure.

Mark Lassiter, spokesperson with Social Security, says these two strategies have been around a few years but not many people have used them. “They’re really just getting talked about in the past year,” he says.

If you or your spouse can hold off until full retirement age, the benefits may be significant.

1. Claim and suspend

If you’ve already started collecting Social Security but don’t need the money now, you can change your mind, thanks to a little-known provision called “claim and suspend.” That is, once you’ve claimed your benefits, you can turn around and suspend them for as long as you like. Claiming and suspending may add to your bottom line in three ways:

  • First, by signing up for Social Security, your spouse can also claim a spousal benefit, which typically is about 50 percent of yours. (The spousal benefit continues even if you suspend.)
  • Also, by suspending, then delaying your own benefit, the amount you’ll eventually receive each month continues to grow at 8 percent a year, until you’ve hit 70.
  • And, if you die first, the higher benefit is passed on.

Only Social Security recipients who are of full retirement age and have never collected early benefits can use the claim-and-suspend strategy.

2. Claim now, claim more later

This strategy works for married couples who claim benefits based on their own work record. If one of you has taken your benefit, the other can draw a spousal benefit, typically around 50 percent, even while continuing to work.

It works like this: If your husband (or wife) is receiving a benefit and you have reached full retirement age, you could claim a spousal benefit, rather than your own. You typically would get about half of what your spouse receives.

Meanwhile, your own retirement benefit continues to grow at 8 percent a year. When you reach 70 (when the amount no longer qualifies for the annual increase), you could switch from a spousal benefit to claim your own benefit, if it’s larger.

The purpose of the law

These strategies were included in the Senior Citizens Freedom to Work Act of 2000, passed to encourage people to continue working beyond their retirement age. One way to achieve that, explained Patricia Dilley, professor of law at the University of Florida and a former staffer on the House Social Security subcommittee, was to allow people to access some level of retirement benefits while they stayed on the job.

Topic Alerts

You can get weekly email alerts on the topics below. Just click “Follow.”

Manage Alerts

Processing

Please wait...

progress bar, please wait

Tell Us WhatYou Think

Please leave your comment below.

Jobs You Might Like

Discounts & Benefits

From companies that meet the high standards of service and quality set by AARP.

UPS Store membership discount aarp benefits

Members save 15% on eligible products/services, 5% on UPS shipping at The UPS Store®.

membership adt

Small business owners save 20% on new installation of any new ADT security system.

Mujer en la parte de afuera de so negocio

Free quotes for members from the AARP® Small Business Insurance Program.

Member Benefits

Renew today! Members receive exclusive member benefits & affect social change.

Rewards for Good

Your Points Balance:

Learn More

Earn points for completing free online activities designed to enrich your life.

Find more ways to earn points

Redeem your points to save on merchandise, travel, and more.

Find more ways to redeem points

Explore Your Learning Possiblities