Social Security benefits are a key part of retirement income for millions of Americans. Yet many people unknowingly make decisions that reduce their monthly payments—sometimes permanently. Understanding how the system works and avoiding common errors can make a big difference in how much you receive throughout retirement.
Whether you’re years away from retirement or planning to file soon, here are some common mistakes that can reduce your Social Security benefits—and how to avoid them.
1. Claiming Benefits Too Early
One of the biggest mistakes people make is claiming Social Security benefits at age 62, the earliest possible age. While it might be tempting to take the money early, doing so comes with a permanent reduction in your monthly benefit—up to 30% less than if you waited until full retirement age (FRA), which is currently 66 or 67, depending on your birth year.
If you wait until age 70, your benefit increases through delayed retirement credits, up to 8% more per year after FRA. Delaying can significantly boost your lifetime income, especially if you live into your 80s or 90s.
2. Not Understanding the Earnings Limit
If you claim benefits before full retirement age and continue working, your benefits may be temporarily reduced if your earnings exceed a certain limit. In 2025, the Social Security earnings limit is $22,320. For every $2 you earn over that amount, $1 is withheld from your benefits.
Once you reach FRA, this limit no longer applies, and your monthly benefit is adjusted to account for any withheld payments. Still, if you don’t understand how the earnings limit works, you might end up with a smaller check than expected.
3. Overlooking Spousal and Survivor Benefits
Many retirees leave money on the table by not exploring spousal or survivor benefits. If you’re married, divorced, or widowed, you may be eligible for benefits based on your spouse’s or former spouse’s earnings.
For example, you could receive up to 50% of your spouse’s benefit if it’s higher than your own. If you’re widowed, you might qualify for survivor benefits that could be even more valuable. It’s important to coordinate claiming strategies with your spouse to maximize both of your benefits.
4. Failing to Correct Earnings Records
Social Security benefits are based on your lifetime earnings, specifically the 35 highest-earning years. If your income history contains errors, such as underreported wages or missing years, your benefit could be lower than it should be.
Check your Social Security Statement regularly through your online mySocialSecurity account to ensure your earnings record is accurate. If you spot a mistake, gather W-2s or tax returns and report it to the Social Security Administration (SSA) immediately.
5. Misunderstanding the Tax Rules on Benefits
Many people are surprised to learn that Social Security benefits can be taxable. If your combined income (including wages, pensions, and investment income) exceeds a certain threshold, up to 85% of your benefits could be taxed.
For individuals, this threshold starts at $25,000; for married couples filing jointly, it’s $32,000. Understanding how your other income affects your Social Security benefits can help you plan better and possibly reduce your tax bill through strategic withdrawals from retirement accounts.
6. Not Factoring in Longevity
Underestimating how long you’ll live in retirement is a common error that can lead to claiming benefits too soon. If you expect to live into your late 80s or beyond, it often makes financial sense to delay benefits to receive the highest possible monthly amount.
Social Security is one of the few sources of guaranteed lifetime income, and delaying benefits acts as a form of longevity insurance, protecting you from outliving your savings.
Conclusion: Take Time to Plan Smartly
Your Social Security benefits represent a lifetime of work and earnings. While the system might seem complex, taking the time to understand it—and avoiding these common mistakes—can lead to thousands of dollars in additional income over your retirement years.
Work with a financial planner, use tools like the SSA’s retirement estimator, and review your options carefully before filing. With the right strategy, you can make the most of your Social Security benefits and secure a more comfortable retirement.
You can access your statement or register for an account by visiting the official Social Security website.
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