It seems like any method to increase your Social Security benefits come at a cost. You might have to work longer hours, pay more federal tax, or even postpone retirement. Keep in mind that everyone is unique and different when it comes to computation.
The Social Security program uses your best 35 years of earnings in the workforce, and it’s also adjusted for inflation. Try to have at least 35 because if you work 40, then 5 of your worst years are deleted. If you are earning a huge salary before you retire, the numbers will drastically improve, which is why it would be wise to keep paying into the program as long as you can.
It does seem as if the retirement age is getting older. You are penalized for starting your benefits earlier than what’s recommended. However, you are rewarded for participating in the program the longer you wait.
The normal retirement age is 67, believe it or not, according to the Administration. You can retire as early as age 62, but that also comes with a cost, as it will permanently reduce your future benefits. You lose about .56% (point 56 percent) of your benefits each month during the first 36 months and .42% (point forty-two percent) per month thereafter.
This is why some people are delaying their benefits until they are 70 years old. By doing so, your benefit will increase, depending on your date of birth. In fact, it’s about a 8% increase for each year you wait on Social Security.