Social Security and Your Finances: Key Considerations for a Solid Financial Plan

While most of us are familiar with Social Security and may have taken the step to check our future benefit estimates, a comprehensive understanding of how Social Security fits into your overall retirement picture is often overlooked. Social Security benefits make up approximately 40% of the average retiree’s income. This statistic highlights the importance of incorporating these effective claiming strategies into your broader financial plan.

Even if retirement seems distant, gaining a comprehensive understanding of how the program works offers valuable insights into your future retirement decisions. Here are some essential points to consider about Social Security as you navigate your retirement planning.

Will Social Security Make an Impact?

Let’s look at the numbers. While the average Social Security retirement benefit payment is about $1,705 per month, the maximum benefit at full retirement age for 2024 is $3,882 per month. For those who wait until age 70 to start receiving payments, the maximum monthly payment for 2024 is $4,873.

As Social Security payments increase with cost-of-living adjustments (COLA), the monthly benefit will continue to escalate throughout your retirement. The monthly benefit amounts may not seem like much, but add them up over your life expectancy and it’s no small figure. Even if you don’t require Social Security payments to live on during retirement, the benefits can be invested or gifted to your heirs. That’s why it’s vital to plan ahead to maximize your total lifetime benefit and aim to use the asset as part of your overall financial plan.

Crucial Claiming Decisions

There are two critical claiming decisions you need to consider to optimize your total lifetime benefit. First, you’ll need to decide when to start receiving benefits. Second, you’ll need to determine how to claim spousal benefits to maximize the entire lifetime payments for two spouses.

When to Claim Benefits

Social Security benefits can be claimed anytime between ages 62 and 70. However, the timing of when you choose to collect these benefits will impact the amount of benefit you receive. If you choose or are forced into an early retirement, you can begin receiving Social Security benefits as soon as age 62. However, if you file to receive benefits any time before reaching your full retirement age, you will receive a reduced benefit.

If you wait until you reach full retirement age to begin collecting your Social Security benefits, you will receive your full primary insurance amount, which is the full benefit that you have earned. If you don’t need your Social Security benefit at full retirement age, you can delay receiving your benefits. For each year that you delay, your benefit will increase by 8%, for a maximum possible increase of 32%. Your benefit will only increase until you begin receiving it, or until you turn 70, whichever happens first.

Spousal Benefits

Deciding how and when to claim spousal benefits may depend on your overall financial strategy and individual situation. In general, the lower-earning spouse may choose to begin collecting benefits early while the higher-earning spouse plans to wait as long as possible. That way, a couple can make use of the lower benefit while maximizing the higher benefit.

If the husband has a larger benefit, his spouse may claim first. Because women tend to live longer than men, this strategy can not only maximize the husband’s retirement benefit for use while he is alive but also maximize the wife’s survivor benefit when he passes away.

Create a Comprehensive Strategy

Strategizing a stable retirement income involves tapping into many sources, and understanding how Social Security fits into the equation is crucial to the health of your overall financial picture. Your retirement plan should encompass employer-sponsored retirement plans, personal retirement accounts, savings, and investments.

At Comprehensive Advisor, we’re dedicated to guiding your retirement journey toward stability while tailoring it to your unique needs. If you’re curious about the impact of Social Security on your financial plan or wish to explore optimal claiming strategies, schedule a complimentary introductory meeting with us online. Email us at or call (760) 813-2125.

About Our Advisors

Brett Gottlieb is the founder of Comprehensive Advisor and a financial advisor with nearly two decades of industry experience. He graduated from California State University-Chico with two bachelor’s degrees, in business administration and economics, and is Life Insurance licensed in several states. He is passionate about guiding his clients on retirement income planning, helping each client pursue their specific retirement goals, and defending the assets his clients have worked so hard to achieve. Brett is a California native and currently resides in San Elijo Hills with his beautiful wife and three children.

Our team of qualified professionals have experience in the financial service industry, and our advisors hail from some of the largest independent broker/dealers and banking institutions in the country. They have dedicated their professional careers to creating personalized financial solutions for individuals and families who seek successful retirement planning and currently offer investment advisory services through AE Wealth Management, LLC. Our advisors take a common-sense approach to the planning process and work with clients to create a retirement road map to help ensure their assets are protected and they receive the income needed to enjoy their future. Based in Carlsbad, California, they work with clients throughout San Diego County and beyond. Learn more by connecting with Brett on LinkedIn or email them at

Investment advisory products and services made available through AE Wealth Management, LLC (AEWM), a Registered Investment Advisor.  C.A. Financial & Insurance Services, CA Ins. Lic. #6000262. This material is intended to provide general information and is believed to be reliable, but accuracy and completeness cannot be guaranteed. Investing involves risk, including the potential loss of principal. Any references to protection benefits, safety, security, lifetime income, etc., generally refer to fixed insurance products, never securities or investment products. Insurance and annuity product guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company. 2161044 – 12/23


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