As a result of the recent government shutdown, some 58 million Social Security beneficiaries will see a 1.5% rise in their benefits. This percentage is based on increases in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).
The nice thing for those who haven’t claimed Social Security benefits yet is that these increases makes waiting to collect Social Security more alluring. Why? As Matthew Allen, the co-founder of and CEO of Social Security Advisors states, “For those that are on the fence about when to claim their Social Security, small COLAs can make claiming Social Security at a later time even more attractive.” Duh, you’re going to be earning more money. Retirement credits will continue to rise and those who wait will be able to lock a lower base benefit amount.
Of course, this is a smart strategy… you want to maximize your Social Security. You want it to reach its full potential. As Allen says, “You want to make sure that one is maximizing his or her Social Security by making the best choices about when to file and how to coordinate one’s Social Security benefits with his or her spouse in order to receive the highest combined spousal and survivor benefits that are available.”
Allen demonstrates that the average couple that doesn’t form a strategy when applying for Social Security benefits is practically leaving $120,000 unclaimed during their joint lifetimes. So, what’s the advice? “Focus on what you can control; make smart decisions about when and how to file for your benefits to receive the largest base benefit amount available. Any COLA added to this amount will be to your benefit.”
Thankfully there are several tools and online calculators that can help you determine when it’s best to start collecting Social Security. You should also be checking the accuracy of your earnings history on your Social Security Statements.
“Missing one or two years of earnings that should be included in your earnings history can have an important impact on your Social Security benefits over your lifetime and, in some cases, may be even more substantial than the impact of COLAs.”
Kenneth G. Marks has been practicing personal injury law since he was admitted to the California Bar in 1981. www.KmarksLaw.com