Allison Alley
ABOUT Allison

Since 2003 Allison Alley has been committed to working with clients to help them achieve their retirement, estate, investment, and tax planning needs. Prior to joining Pure Financial Advisors, Allison served as Senior Vice President of a small private wealth management and investment banking firm where she specialized in comprehensive wealth planning to address the [...]

Understanding how Social Security benefits work and implementing some strategies can really help you get the most out of your Social Security in retirement. Allison Alley, CFP®, AIF®, Pure financial advisor covers 5 ways to maximize your benefits:

1. Understand how your Social Security benefit is calculated.
2. Impact of starting your Social Security income early or deciding to delay.
3. Pay attention to spousal benefits.
4. If applicable, apply for Survivors benefits.
5. How much of your Social Security income is subject to federal taxation.

In addition: Withdrawing your social security Retirement application. Check your Social Security earnings record for accuracy.

FREE GUIDE | The Social Security Handbook

Download the Social Security Handbook


Ways to maximize your Social Security benefits.

First, you really need to understand how your Social Security benefit is calculated. The Social Security administration takes your 35 highest earnings years to calculate the amount you’re entitled to at your full retirement age. If you’ve worked fewer than 35 years, Social Security will use zeros for those years. This means that you can make an impact on the amount of your future income if you work a few more years and replace some of the zeros with income numbers.

Number two, knowing your full retirement age and the impact of starting your Social Security income early or deciding to delay it. Full retirement age for most people is between 66 and 67. Delaying your benefit is actually the easiest way to increase your payment. Let’s say your full retirement age is 67; you can start taking your benefit as early as age 62, but this would reduce your monthly amount by almost 30%. For every year past age 67 that you wait, Social Security gives you an 8% annual increase in your benefit until age 70. There’s no additional benefit for waiting past 70.

Number three, pay attention to spousal benefits. Everyone’s entitled to their own benefit based on their own earnings record or half of their spouse’s benefit, whichever is higher. So, if you don’t have enough credits to qualify for your own benefit or your own benefit based on your own earnings record is less than 50% of your spouse’s benefit, you would file for the spousal benefit. You can also file for spousal benefits as early as age 62, but they would be reduced. However, unlike your own benefit, waiting past your full retirement age will not increase your spousal benefit. You may also be eligible for spousal benefits even if you’re divorced. As long as your marriage lasted at least 10 years and you’ve never remarried, you’re entitled to the same spousal benefits as if you were still married.

Number four, if applicable, apply for survivor’s benefits. When one spouse dies, the surviving spouse is entitled to the higher of their two benefits. This is an example of when waiting as long as possible to claim benefits, in the first place, can help. Unlike spousal benefits, which are based on the higher earning spouse’s full retirement age amount, survivor benefits are determined by the amount the higher earning spouse was actually receiving when they die.

Number five, pay attention to how much of your Social Security income is subject to federal taxation. Most likely you’ll pay federal tax on at least some of your Social Security income. The calculation of exactly how much is somewhat complicated, but it depends on how much other taxable income you have. So, you want to be strategic about the amount of non-social security income that you’re drawing. You may want to pull from a combination of your traditional IRA and Roth accounts in order to have some control over how much of your Social Security income is actually going to subject to federal tax.

Just a few other things to note.  If you do start taking your Social Security benefits and you decide within 12 months that it was too early, you can actually undo your claim. You would basically pay back benefits that you received to date and then you could start over at a later date and take advantage of being eligible for the higher amount that you would’ve gotten if you had waited to begin with. If you decide that you took your benefits too early, but it’s been past 12 months you can actually suspend your benefit. You stop getting payments from that point forward and then you can restart them at a later date, and you still get the 8% increase in between suspending your benefits and when you restart them.

The last thing I want to say is, check your Social Security statements, check your earnings record, and make sure that they’re accurate. Mistakes get made sometimes in reporting and they can impact your future benefit. If you look at your earnings record and you see any mistakes you want to notify the Social Security administration.

Really, understanding how things work and implementing some simple strategies can really help you get the most out of your Social Security income in retirement.

Subscribe to our YouTube channel.


• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC, a Registered Investment Advisor.

• Pure Financial Advisors LLC does not offer tax or legal advice. Consult with your tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

• Intended for educational purposes only and are not intended as individualized advice or a guarantee that you will achieve a desired result. Before implementing any strategies discussed you should consult your tax and financial advisors.

CFP® – The CERTIFIED FINANCIAL PLANNER™ certification is by the Certified Financial Planner Board of Standards, Inc. To attain the right to use the CFP® designation, an individual must satisfactorily fulfill education, experience and ethics requirements as well as pass a comprehensive exam. Thirty hours of continuing education is required every two years to maintain the designation.

AIF® – Accredited Investment Fiduciary designation is administered by the Center for Fiduciary Studies fi360. To receive the AIF Designation, an individual must meet prerequisite criteria, complete a training program, and pass a comprehensive examination. Six hours of continuing education is required annually to maintain the designation.