Dissatisfied with your social security benefit? Here’s how you can boost it | Smart Change: Personal Finances
Underestimating the cost of living for seniors is a common mistake people make when planning for retirement. It’s easy to assume that once you stop working you’ll start spending a lot less, especially since you’ll have an open schedule that doesn’t revolve around a job.
But many seniors learn the hard way that retirement is more expensive than expected. While not having to show up for work means cutting back on some expenses, like travel, it also means spending more time at home and having more hours to fill. This could easily result in the need for more money for things like utilities and activities.
This is why it is so important to file strategically for Social Security. Producing too soon could leave you with a lower advantage – an advantage that won’t end up reducing it in the context of your total spend.
People also read…
But what if you already went to file for Social Security earlier? You might assume that you are now stuck with the monthly benefit you locked in.
The good news is that you may be able to get a higher monthly benefit. The bad news, however, is that it may not be so easy to undo your Social Security statement to increase your benefits.
You get a second chance
If you are not satisfied with your monthly Social Security benefits, you are not necessarily obligated to them for life. But if you want to increase this advantage, you will have to act quickly.
Once you apply for Social Security, you have a once in a lifetime opportunity to cancel your claim and re-enroll for benefits at a later age, in which case you should be entitled to more money on a monthly basis. But to take advantage of this option, you will need to do two things.
First, you will need to withdraw your claim for benefits within one year of submitting it. So if it’s been 10 months since you started collecting Social Security, now is not the time to mess up.
However, the even trickier part of the equation is reimbursing the Social Security Administration for all the money it has paid you to date. If you do not repay all your benefits within one year, you cannot cancel your declaration.
If you have savings to tap into, repaying these benefits may be feasible. But if you don’t have any savings and you’ve already spent that money, things get complicated.
In this situation, however, you may still have a few options. If you own your home, you can potentially pay off your Social Security benefits with proceeds from a home loan or line of credit. And if you have valuable assets that you’re willing to part with – for example, works of art that are worth a good amount of money – you can sell them to snag some cash.
Don’t settle for a perk that will leave you strapped for cash
If you realize at the start of your retirement that you have miscalculated your costs and that your current monthly Social Security benefit will not reduce it, it is definitely worth checking whether canceling your claim is an option. You could, in theory, end up collecting a monthly Social Security benefit for the next 30 years of your life or more. The last thing you want is an advantage that you know won’t lead to the lifestyle you hope to maintain.
The $18,984 Social Security premium that most retirees completely overlook
If you’re like most Americans, you’re a few years (or more) behind on your retirement savings. But a handful of little-known “Social Security secrets” could help boost your retirement income. For example: an easy trick could earn you up to $18,984 more…every year! Once you learn how to maximize your Social Security benefits, we believe you can retire confidently with the peace of mind we all seek. Just click here to find out how to learn more about these strategies.
The Motley Fool has a disclosure policy.