Millions of seniors benefit from the Social Security cost-of-living adjustment (COLA), an annual raise that aims to help benefits maintain their buying power over time.

The official announcement for next year's adjustment won't come until October, but there are already predictions around what the 2026 COLA might look like. Right now, beneficiaries are on track to receive the lowest adjustment in years -- but there's an important reason that could change.

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Image source: Getty Images.

The good and bad news about next year's COLA

The COLA is based on changes to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), a monthly index that tracks consumption patterns among U.S. workers.

To calculate the COLA, the Social Security Administration takes an average of the CPI-W values in the months of July, August, and September. It then compares that average to the previous year's figure from the same period. If the current number is higher, the percentage difference will become next year's COLA.

Based on CPI-W data so far this year, nonpartisan group The Senior Citizens League predicts that the 2026 COLA could land at around 2.3%. That would amount to a raise of around $46 per month for the average retired worker, and it would also be the smallest adjustment since 2021.

That said, there's a silver lining to a smaller COLA: It means inflation is slowing. The CPI-W essentially tracks inflation trends, so higher values year over year mean that consumer prices have been surging. When inflation ran rampant in 2022 and 2023, for example, we saw record-breaking COLAs of 5.9% and 8.7%, respectively.

While a smaller COLA may be disappointing on the surface, it's actually a good sign that prices are not increasing as quickly as they have in the past. Ultimately, that will generally have a greater impact on retirees' budgets than slightly larger Social Security checks.

One big factor that could change the COLA

A lot could change between now and October, primarily when it comes to inflation. President Trump's tariff policies could have a major impact on the economy and consumer prices, with experts pointing out that tariffs have a direct correlation with inflation.

"In the short run, tariffs are seen as inflationary," Ryan Monarch, economics professor at Syracuse University, told The Motley Fool in an interview. "[A]ll else equal, the more widespread the tariffs, the tighter Federal Reserve policy will likely be in order to tamp down upward price pressure."

In February, analysts at the Federal Reserve Bank of Boston reported that 25% tariffs on imports from Canada and Mexico and an additional 10% tariff on China could increase the core inflation rate, which excludes the more volatile food and energy sectors, by 0.8 percentage points. A 60% tariff on goods from China and 10% tariffs on other countries could increase inflation by 2.2 percentage points.

If inflation surges throughout the rest of 2025, fueled by tariffs, it will likely result in a larger COLA for 2026. That isn't necessarily a good thing for retirees, though, as higher costs will already take a significant bite out of most Americans' budgets before the COLA takes effect.

What does history say about times like these?

In many ways, we're in uncharted territory right now. So history may or may not be helpful in predicting where we're headed.

That said, historically, tariffs can often pave the way for a recession. In fact, analysts at J.P. Morgan announced in mid-April that they predict a 60% probability of entering a recession by the end of this year, triggered primarily by the Trump administration's tariff policies.

While tariffs themselves often lead to price surges, recessions also tend to drag prices back down since consumers generally have less disposable income. That could complicate COLA predictions throughout the rest of this year.

A lot can happen between now and October. Tariffs and a potential recession could have a major impact on consumer prices, which will influence the next Social Security COLA. For now, perhaps the best thing you can do is simply stay informed and keep your expectations in check.

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Many investors may know the average Social Security benefit for retirees currently stands at $1,976 per month. But that's an average with a wide range of inputs as well as potential outputs. The more money you earned during your working years, the greater your eventual payment becomes. The age at which you choose to initiate your benefits can also impact the size of your check.

With that as the backdrop, what's the average 75-year-old retiree collecting from Social Security these days? The agency reports it's $2,749 per month. For the sake of comparison, the typical 70-year-old is currently collecting $2,842 per month (the highest average age-based figure, by the way), while the average 80-year-old's monthly payment stands at $2,412.

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Curiously, the 70-to-80-year-old crowd (born post-World War II, between 1945 and 1955) are seeing measurably bigger Social Security payments than the over-80 crowd as well as the under-70 crowd. The swell in the size of this cohort's Social Security payments suggests these so-called baby boomers enjoyed uniquely strong employment opportunities and subsequently strong incomes for almost all of their adult lives.

Not bad, but still not enough

So you're doing better than average, or you know you will be doing better when the time comes based on the Social Security Administration's projection of your future benefits? Don't celebrate too much, or too soon. This average payment still isn't covering the entirety of retirees' typical living costs.

Smaller payments don't necessarily spell doom, either. Plenty of people are generating more investment income from their retirement savings during their golden years even if they're collecting subpar Social Security payments.

And that's how it should be. The program was never meant provide all of your retirement income no matter how much or how little you put into it.

The bigger takeaway here is that you'll want to save as much as you possibly can for retirement on your own, and make the most of that savings while you can. This, of course, means achieving long-term gains that measurably and meaningfully outpace inflation.

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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 ensure a boost in your retirement income.

One easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Join Stock Advisor to learn more about these strategies.

View the "Social Security secrets" »

The Motley Fool has a disclosure policy.

For a majority of American retirees, Social Security provides more than half of their income. Some live on the program's benefits alone. But most U.S. seniors supplement those benefits with their retirement savings.

Built into the program is a regulation that boosts the size of beneficiaries' payments every year via a cost-of-living-adjustment (COLA) that is intended to help Social Security benefits maintain their purchasing power in the face of inflation.

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However, many argue that the metric used to calculate how large those adjustments should be doesn't fully reflect how rising prices impact seniors, and that, as a result, those COLAs are not keeping pace with real-world inflation.

While I'm still far away from retirement, I'm not counting on Social Security to single-handedly support me once I get there, nor am I expecting its COLAs to fully cushion my finances against inflation. Here's what I'm doing to combat that future inflation instead.

The reality of Social Security COLAs

Each year's COLA is calculated based on the U.S. inflation rate during July, August, and September of the previous year -- so, for example, however much the Consumer Price Index rises in the third quarter of 2025, that's how much benefits will get boosted starting in January 2026. While that may sound straightforward, many experts say benefits are gradually losing their purchasing power.

A 2024 study conducted by the nonpartisan Senior Citizens League (SCL) found that the average retiree's Social Security benefits in 2024 had roughly 80% of their 2010 purchasing power, and asserted that the average benefit would need to be boosted by $4,443 per year to bring it back to 2010's level.

One reason for this is that, by law, the Social Security Administration (SSA) uses the Consumer Price Index for All Urban Wage Earners (CPI-W) to calculate COLAs. However, the SCL believes the basket of products and services that the CPI-W is based on doesn't align well with what retirees actually spend their money on. Instead, the SCL would like to see COLAs calculated using the Consumer Price Index for the Elderly (CPI-E).

The SCL also points out that COLAs lagged behind annual inflation rates in eight of the last 15 years, largely because they are based on price data from a single quarter. Even minor gaps between COLAs and the actual rate of inflation can compound over time into significant losses of purchasing power for beneficiaries.

Image source: Getty Images.

Keeping your finances ahead of inflation

All that said, there are actions that people of all ages can take to help cushion their retirement finances against the inevitable impacts of inflation. One thing I am doing is investing as much money as I can. This does not involve high-stakes day trading or a complex options strategy. Rather, I invest money each month through a tax-advantaged retirement account and a standard brokerage account.

The great Warren Buffett has said many times that over time, the impact of compound growth is so powerful that it can make mediocre investors rich. Investors should be sure to gradually adjust their asset allocations based on their age and how long they have until retirement, but steady and consistent investing should prove to be a winning strategy.

I'm planning on working for at least another 30 years, which allows me to comfortably load up more on stocks and be more aggressive with my choices. However, when my retirement approaches, I plan to dial that back and shift more of my portfolio into less volatile assets so that I'm less exposed to the short-term gyrations of the market during the period when I'll be regularly drawing down on those funds.

Another good strategy is to try and manage your expenses and cut when you can. One thing I do each month is budget out my salary and how much I think I am going to spend. I also carefully track my progress because unexpected expenses arise.

I try and save discretionary purchases closer to the end of my credit card cycle, so I know exactly where I am at and how much I have left to work with. Coming in below my monthly budget for even three to six months of the year goes a long way because it's extra money to either invest or adds a cushion for unexpected expenses later in the year.

Finally, it can be good to practice some austerity each year. What subscriptions can you cancel? Can you go out to lunch or dinner a few times less each month? Are there material items you can live without? Can you buy certain household items in bulk? It may not seem like it at the time, but all of these little items can go a long way over a few years.

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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 ensure a boost in your retirement income.

One easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Join Stock Advisor to learn more about these strategies.

View the "Social Security secrets" »

The Motley Fool has a disclosure policy.

• My husband wanted to retire early, so I agreed to do the same, but I hated it.
• I went back to work while my husband remained retired and focused on saving money.
• Since I wanted to keep spending money, we often fought until we made a compromise.

I recently watched a webinar and was ready to push the "count me in" button and spend $3,000 on the program. However, I restrained myself because I value my marriage.

Dave and I used to be in sync as entrepreneurs. We ran his accounting firm and my consulting company out of the same office. We went to lunch daily, where we would share our goals, challenges, and wins. We freely spent money on business, pleasure, and family.

Dave loved his clients but not accounting itself, so he wanted to retire early at 55. I loved my clients and my work, so retirement was the last thing on my mind. But when Dave was ready, I agreed to give it a try.

It wasn't as easy as I thought it would be.

I retired with my husband, left the city, and started a new life

We went full-on with the retirement experience. We moved to a remote mountain ranch covered in redwoods, got three dogs, raised peacocks and chickens, bought a horse for our daughter, and took long walks in the woods.

Dave built fun things like a library, a teepee, a fully plumbed outhouse, and a gazebo nestled in the trees for our spa. He was in heaven.

I loved the lifestyle, but at 50, I missed the challenge of consulting and the satisfaction of teaching. Trees are great to look at, but they make lousy seminar participants and block the internet. My frustration was growing.

Retirement wasn't working for me

Dave called one morning. He was emptying our office and said, "I'm just going to get rid of all your training room chairs."

The words stabbed like a knife through my heart, and I lost it. I realized what that meant and fell into a chair, moaning that my life was over. No more clients, no more seminars, no more networking, no more anything — except trees, trees, and more trees.

Dave was dumbfounded. He said, "But we agreed to this." I told him I'd honor our agreement, but I didn't know how I could be happy letting my calling die in the woods.

He decided that we should move back to the city since I wanted to get back into action.

I was stunned. I knew how much he loved the mountain ranch, but I was grateful for the suggestion and agreed. We turned the ranch into a VRBO rental and returned to the city.

Back in the city, I restarted my business, our daughter went to school, and Dave continued his retired lifestyle. Retirement didn't just affect his activity level; it affected his mindset about money.

My husband is now in money-saving mode, while I want to spend

When we were both making money and could easily make more when we needed it, he was much less miserable. Now that he is on Social Security, he wants to spend almost nothing and make sure we have enough money to live on until we die.

My focus is the opposite. I don't want to hunker down. I want to expand. I see the business landscape changing at the speed of light, and I want to take every course, attend every conference, subscribe to every newspaper and magazine, and try every new gadget. All of these things take money.

When I first started rebuilding, Dave let me loot our retirement account, but then he put his foot down, and fireworks flew. After having the first real fights of our marriage, we finally came to a truce.

We agreed that I would no longer touch our nest egg, but I can spend anything I currently earn in any way I want. I only touch one bank account we set aside for my income and expenses. He handles everything else as if we are both retired.

I like to think that I'm the kite, and he's the string. It works for us.

Americans work hard and pay taxes throughout their career. When they retire, they no longer have to work as hard.

But paying taxes? That's a different story. Taxes are seemingly inescapable, no matter how old you are.

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However, there's some good news for retirees, depending on where you live. As of 2025, 41 states don't tax Social Security benefits.

Image source: Getty Images.

The nine states that do tax Social Security

Before we get to those 41 states that don't tax Social Security, let's look at the outliers that do. Nine U.S. states continue to require retirees to pay state income taxes on their Social Security benefits:

1. Colorado
2. Connecticut
3. Minnesota
4. Montana
5. New Mexico
6. Rhode Island
7. Utah
8. Vermont
9. West Virginia

Not every retiree will have to pay state taxes on Social Security in these states, though. For example, Connecticut seniors who are single filers or married filing separately are exempt from state taxes on Social Security benefits if their adjusted gross income (AGI) is below $75,000. Those who are married filing jointly or who file as head of household don't have to pay state taxes if their AGI is below $100,000. Minnesota, New Mexico, Rhode Island, and Vermont have similar income tax regulations with different AGI thresholds.

Also, West Virginia is transitioning from taxing Social Security benefits. The Mountain State allows residents to subtract 65% of their Social Security benefits from their AGI in 2025. However, next year, the amount will increase to 100%.

States that don't tax Social Security

Now for the states that don't tax Social Security. The list currently includes 41 states, up from 39 just a couple of years ago:

1. Alabama
2. Alaska
3. Arizona
4. Arkansas
5. California
6. Delaware
7. Florida
8. Georgia
9. Hawaii
10. Idaho
11. Illinois
12. Indiana
13. Iowa
14. Kansas
15. Kentucky
16. Louisiana
17. Maine
18. Maryland
19. Massachusetts
20. Michigan
21. Mississippi
22. Missouri
23. Nebraska
24. Nevada
25. New Hampshire
26. New Jersey
27. New York
28. North Carolina
29. North Dakota
30. Ohio
31. Oklahoma
32. Oregon
33. Pennsylvania
34. South Carolina
35. South Dakota
36. Tennessee
37. Texas
38. Virginia
39. Washington
40. Wisconsin
41. Wyoming

Nine of these states don't tax any income:

• Alaska
• Florida
• Nevada
• New Hampshire
• South Dakota
• Tennessee
• Texas
• Washington
• Wyoming

Mississippi also recently passed legislation that could phase out its state income tax by 2040. However, specific triggers related to revenue and spending must be met for the Magnolia State's planned tax cuts.

Speaking of Mississippi, it's one of 13 states that don't tax any retirement income from 401(k) plans, IRAs, or pensions. Of course, this list includes the nine states without income taxes. It also includes Illinois, Iowa, and Pennsylvania.

Uncle Sam still has his hand out

Regardless of which state you live in, you could have to pay federal taxes on your Social Security benefits. Whether your benefits will be taxed and how much tax you'll have to pay depends on how much money you make. The table shows what the current levels are:

Data source: Social Security Administration. Table created by author.

To determine your combined annual income, add half of your Social Security benefits plus all other income. Other income includes money received from capital gains, dividends, interest, pensions, and wages.

Could Uncle Sam join the 41 states that don't tax Social Security benefits? Maybe. President Trump has proposed eliminating federal taxes on retirees' Social Security benefits. While the idea is relatively popular, though, it comes with a significant downside: Ending federal taxation on Social Security could speed up how quickly the program's trust funds run out of money.

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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 ensure a boost in your retirement income.

One easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Join Stock Advisor to learn more about these strategies.

View the "Social Security secrets" »

The Motley Fool has a disclosure policy.

Many retirees are watching their 401(k) and individual retirement account (IRA) balances sink further seemingly daily. Whatever you might think about President Donald Trump's steep tariffs, they're indisputably wreaking havoc on the stock market.

Could tariffs even impact retirees' Social Security benefits? The answer just might be "yes." Here's what President Trump's tariff turmoil could mean for your next Social Security cost-of-living adjustment (COLA).

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Image source: Getty Images.

Calculating the COLA

To understand how the president's tariffs could impact your next Social Security COLA, we must first delve into how the COLA is calculated. The good news is that the formula is simple, and the math is easy.

For decades after Social Security was created, any adjustment to benefits required an act of Congress. However, an automatic annual adjustment went into effect in 1975. This adjustment was intended to keep Social Security benefits from being eroded by inflation.

With this goal, it makes sense that inflation would be the key factor used to calculate the COLA. Economists use several inflation metrics. However, the Social Security Administration (SSA) uses one called the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). This inflation metric measures price changes for primarily blue-collar workers in urban areas.

The CPI-W is published monthly by the U.S. Bureau of Labor Statistics. The SSA calculates the COLA using the difference between the average CPI-W for the third quarter of the current year and the average for the same period in the prior year, rounded to the nearest one-tenth of a percent. If the Q3 average CPI-W for the current year is less than the Q3 average for the previous year, no adjustment is made to Social Security benefits.

How tariffs could impact your next Social Security COLA

President Trump's tariffs will impact your next Social Security COLA if and only if they affect the CPI-W in the third quarter of 2025. Could that happen? It's a definite maybe.

Some might think tariffs are paid by the countries on which they're levied. However, that's not how tariffs work. Instead, the companies importing products from other countries must pay the U.S. government any tariffs due.

The big question relates to how those importers handle the higher costs incurred. Some importers might absorb most of the tariffs as a cost of doing business in the U.S. Others, though, could pass the higher costs along to their customers. When this happens, the prices of imported products increase. This could lead to a higher inflation rate, which could then cause the next Social Security COLA to be higher than it would otherwise be.

Tariffs could even impact the prices of products made in the U.S. One way this can happen is when components used in those products are imported from countries impacted by high tariffs. Another is if U.S. companies raise their prices to take advantage of an opportunity to make more money when their foreign rivals' prices are higher.

Many economists project higher inflation if the president's tariffs remain in effect. Predictions vary for just how much higher inflation will go. For example, Comerica Bank chief economist Bill Adams told CNBC he thinks tariffs could cause inflation to jump 2% this year from 2.8% to 4.8%. EY Chief Economist Gregory Daco expects a smaller impact, telling CBS News recently that he expects inflation will rise by 1% to nearly 4%.

The potential for a higher Social Security COLA might sound good to some retirees. However, benefit adjustments don't always fully keep up with price increases incurred by older Americans. Also, higher-than-anticipated COLAs could cause the Social Security trust funds to run out of money sooner than projected.

Don't put the cart before the horse

There are several potential scenarios wherein inflation doesn't rise in the third quarter of this year. The president could again pause tariffs or reduce them as he did last week. A lawsuit claiming that President Trump's tariffs are unconstitutional could be affirmed by federal courts. Some economists think steep tariffs could cause a recession, which could hold inflation down.

Retirees shouldn't count on higher Social Security COLAs yet. However, the president's tariffs could very well impact your next COLA.

The $22,924 Social Security bonus 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 ensure a boost in your retirement income.

One easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Join Stock Advisor to learn more about these strategies.

View the "Social Security secrets" »

The Motley Fool has a disclosure policy.

No social program is responsible for pulling more people out of poverty each year than Social Security. According to the Center on Budget and Policy Priorities, the program lifted 22 million people above the federal poverty line in 2023, including 16.3 million adults aged 65 and over.

It's also a program that retired workers lean on heavily to make ends meet. Spanning 23 years of annual surveys, pollster Gallup has found that 80% to 90% of retirees, including 88% in April 2024, require their Social Security income to cover at least some portion of their expenses.

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However, average Social Security checks can meaningfully differ by age. Let's take a closer look at how retired-worker benefits are calculated, examine how much the average retired worker is bringing home each month by age, and take a wide-lens look at which, if any, ages are likeliest to maximize lifetime Social Security benefit collection, based on a comprehensive study.

Image source: Getty Images.

These four factors are used to calculate your monthly retired-worker benefit

Although Social Security isn't the easiest government program to understand at times, the four variables used by the Social Security Administration (SSA) to calculate your retired-worker benefit are straightforward. In no order, these are your:

• Earnings history
• Work history
• Full retirement age
• Claiming age

Your earnings and work history are two factors that are tightly linked together. When calculating your monthly retired-worker benefit, the SSA will rely on your 35 highest-earning, inflation-adjusted years. If you've received an above-average salary or wage throughout your lifetime (investment income doesn't count), there's a reasonably good chance you'll net an above-average Social Security retired-worker check, as well.

But there's a catch to this calculation. In the event that you don't work at least 35 years, the SSA will average in a $0 for every year short of 35. Regardless of how much you've earned in the years that do qualify, you'll have no chance to maximize your monthly benefit without 35 years of work and earnings history.

The third item -- full retirement age -- is based solely on your birth year. It represents the age you become eligible to collect 100% of your retired-worker benefit. For anyone born in or after 1960, the full retirement age is 67.

The fourth and final factor, and the one that packs the biggest punch in terms of swinging the Social Security payout pendulum, is your claiming age. Though retired-worker benefit collection can begin as early as age 62, the SSA dangles a monetary carrot of sorts to incent patience. For every year a worker waits to collect their benefit, beginning at age 62 and continuing until age 70, their monthly payout can increase by as much as 8%.

Here's a breakdown of the average Social Security retirement benefit by age

With a clearer understanding of the variables that impact Social Security benefits, it's time to dive into the variances between average retired-worker benefits by age.

Every year, the SSA's Office of the Actuary updates a table displaying average monthly retired-worker benefits from ages 62 through 99-plus. The table you're about to see is based on average monthly checks doled out in December 2024.

The one thing to keep in mind as you peruse this data is that it's based on the age of the recipient in December 2024 and isn't necessarily indicative of their claiming age (with the exception of age 62). For instance, a retired-worker beneficiary who's 66 may have initially collected their payout anywhere from 62 to 66.

Data source: Social Security Administration Office of the Actuary, as of December 2024.

The most glaring takeaway when looking at nearly four decades' worth of average benefit checks is that claiming age really does matter. While keeping in mind that the above table is based on a recipient's age in December 2024 and isn't necessarily indicative of their claiming age, there are some huge variances at opposite ends of the traditional claiming range of 62 through 70.

On one hand, the roughly 594,200 claimants who were receiving (and claimed) a payout at age 62 brought home an average of $1,341.61 in December, or 32% less than the average retired-worker check for all ages of $1,975.34. Claiming at age 62 permanently reduces your monthly payout by up to 25% to 30%, depending on your birth year.

Meanwhile, close to 3.18 million age 70 recipients took home $2,148.12 per month in December, which is the highest average of any age, and 60% more than the earliest filers were receiving at age 62. Claiming benefits at 70 can increase your payout by 24% to 32% above what you'd have received at full retirement age.

The other interesting tidbit you'll notice is that average monthly benefit checks tend to decline and flatten out in the mid-80s and beyond. This has to do with women have a longer life expectancy than men, as well as women being more likely to act as caretakers.

A Pew Research Center survey from 2021 found that 26% of women were stay-at-home parents, compared to only 7% of men. Fewer years in the labor force adversely impacts the lifetime earning potential for women, which in turn reduces their average benefit from Social Security, as evidenced by this table.

Image source: Getty Images.

There most certainly is a superior Social Security claiming age

Considering the above data on average retired-worker benefits, you might be wondering if being patient pays off when claiming Social Security? An extensive analysis published in 2019 from the researchers at United Income provides a pretty clear answer.

In The Retirement Solution Hiding in Plain Sight, the researchers at United Income used data from the University of Michigan's Health and Retirement Study to extrapolate the claiming decisions of 20,000 retired workers. The purpose was to see how many had optimized their claim -- i.e., chosen the claiming age that maximized their lifetime income collected from Social Security. While this report is six years old, the data it presents still holds true today.

Not surprisingly, only 4% of the 20,000 retired-worker beneficiaries optimized their payout. Without knowing when we'll die ahead of time, our claiming decision is always going to involve some educated guesswork and luck.

Furthermore, we all take a unique path in life. Thus, your mix of monetary needs, access to retirement accounts, marital status, personal health, tax implications, and so on, will be different from everyone else.

However, United Income's study did find a distinctive inversion between actual and optimal claims.

On one hand, 79% of all initial claims occurred at ages 62, 63, or 64. But when extrapolated, only 8% of optimized claims were associated with ages 62 through 64. This is to say that claiming early isn't the best decision for most retirees.

In comparison, 57% of the 20,000 retired workers studied would have maximized their lifetime payout from Social Security had they waited until age 70 to begin collecting. Age 67 was the next-closest in terms of optimization probability at around 10%.

There will absolutely be instances and circumstances where an early filing makes sense. For instance, if you have a chronic illness that can shorten your lifespan, or you're a significantly lower-earning spouse who wants to generate income for the household, an early filing may very well be your best choice.

But when examining the big picture, age 70 is a superior claiming age. Future retirees would be wise to consider waiting to collect their Social Security income.

The $22,924 Social Security bonus 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 ensure a boost in your retirement income.

One easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Join Stock Advisor to learn more about these strategies.

View the "Social Security secrets" »

The Motley Fool has a disclosure policy.

The past few weeks have been a rollercoaster ride for investors. Stock values have plunged, causing many people to panic. And with a lot of economic uncertainty ahead, there's no telling how long it will take the market to recover from its recent fall.

You may be worried about the impact of recent stock market volatility on your retirement savings -- to the point where you're questioning whether your nest egg belongs in the stock market at all. It's an important question to be asking, and here's how to navigate it.

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Image source: Getty Images.

When retirement is far away

It can be unsettling to see the value of your stock portfolio take a dive following a market downturn. But if you're many years away from retirement, there's really no reason to let the events of the past few weeks rattle you.

This recent bout of stock market volatility is not the first of its kind. But when you have time to ride out a storm, there's less to worry about.

Furthermore, if you're tempted to pull your retirement savings out of the stock market, don't. You need stocks in your portfolio to lend to steady growth through the years. And if you invest your retirement savings too conservatively because you're scared about market turbulence, you'll risk ending up with an income shortfall on your hands.

You should know, in fact, that if you're many years away from retirement, now is not only a good time to stay invested in the stock market, but to potentially buy more stocks when they're on sale. Before you add stocks to your portfolio, though, take a close look at its composition. You don't want to overload on one particular market segment, so be careful with the stocks you choose to buy.

When retirement is near

The advice to sit back, relax, and wait things out isn't necessarily applicable to you if you're a year away from retirement and your portfolio has just taken a massive hit. In that case, it's important to review your asset allocation immediately and make changes as necessary to ensure that you're not overly invested in stocks.

If you had 50% of your portfolio or less invested in the stock market before things took a negative turn, then you may not be sitting on such drastic losses now -- which means you may be just fine to move forward with your original retirement plans. If not, you may need to be willing to adjust your plans to account for recent portfolio changes.

Furthermore, if you're already pretty invested in stocks, you may not want to add new ones to your portfolio, despite the fact that stocks are on sale. A better bet may be to put new money into bonds, which are more stable and can generate income for your portfolio.

Although stock market volatility is nothing new, it can still be a daunting thing to deal with. And after the events of the past few weeks, you may be thinking of pulling out of the stock market for good. But if your investing strategy was a solid one from the start, then there's no need to abandon it just because the market is going through a rough patch.

The $22,924 Social Security bonus 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 ensure a boost in your retirement income.

One easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Join Stock Advisor to learn more about these strategies.

View the "Social Security secrets" »

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When to file for Social Security benefits is one of the most important decisions you'll make in retirement. Most people first become eligible for retirement benefits starting at age 62, but experts typically recommend waiting until 70 to maximize your monthly check.

Waiting until age 70 could increase your Social Security benefit by roughly 77% compared to claiming at age 62. Most people will live more than long enough for the bigger monthly check to make up for the years of foregone benefits. Indeed, the optimal decision for a single retiree is to wait until 70, barring any reasons to expect a shorter-than-average life.

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But no financial decision should be made in a vacuum. There are plenty of reasons why it might make sense to claim benefits long before age 70. In fact, I plan to claim my Social Security very early, perhaps as soon as I'm eligible. Here are three reasons why it makes sense for me.

Image source: Getty Images.

1. My spouse (to be) is the higher earner

Social Security claiming strategies can become a lot more complex when you're married in retirement.

It won't always be the case, but it usually makes sense for the higher-earning spouse to wait until age 70 to claim Social Security. As mentioned, the average person will live more than long enough for the bigger benefits check to make up for the Social Security they didn't receive in their 60s.

On top of that, the lower-earning spouse may end up receiving survivor benefits if the higher-earning spouse passes away first. Survivor benefits allow the surviving spouse to collect total Social Security benefits equal to the amount the higher-earning spouse received before passing away. That means the lifetime value of delaying benefits until 70 for the higher earner should account for the dual life expectancy of both spouses.

At the same time, the other spouse should consider collecting retirement benefits as early as age 62. Typically, if one partner waits until age 70, the present value of expected household income is maximized by the other partner claiming as soon as they're eligible.

2. I expect to claim spousal benefits

As things stand, I expect my future spouse's retirement benefit to be big enough that I would receive more each month by claiming spousal benefits over my own. Spousal benefits are worth up to 50% of your partner's primary insurance amount, which is the amount they'd collect if applying for benefits exactly when they reach full retirement age.

The key thing about spousal benefits is that, unlike personal retirement benefits, they do not receive delayed retirement credits. Personal benefits will increase by 8% of your primary insurance amount for each year you delay beyond your full retirement age up until age 70. Spousal benefits will max out at your full retirement age.

For me, that's age 67. As such, there's no reason I should delay claiming benefit beyond that age. That's despite the fact that I'm older than my partner, she's likely going to delay benefits until age 70, and I'll be waiting several years to switch to spousal benefits. It's worth taking the slightly smaller personal benefit for a few years before switching to the bigger spousal benefit.

3. I'm well-positioned to avoid taxes on Social Security income

One of the most overlooked challenges of collecting Social Security in your early 60s is Social Security taxation. Those taxes can completely nullify the benefits of strategies like Roth conversions and capital gains harvesting.

That's why it's important to position your finances to minimize the effect of Social Security taxes before you apply. If you don't, you'll end up decreasing the value of your benefits.

Social Security taxes are based on a metric called combined income, which is equal to the sum of your adjusted gross income, any untaxed interest income, and half your Social Security income. If your combined income exceeds certain thresholds, a portion of your Social Security income becomes taxable. The thresholds don't get adjusted for inflation, so they're increasingly difficult to avoid.

Data source: IRS.

I expect to be able to maintain a very low combined income in retirement, thanks to savings in Roth accounts and increasing my cost basis on taxable assets. We plan to stop earning income well before reaching the age of eligibility for Social Security, which will provide ample time to strategically take capital gains and convert some pre-tax retirement assets to a Roth account. As a result, we should be able to keep our adjusted gross income low in our 60s, minimizing the tax burden of Social Security.

I'm fully aware that most people aren't in the fortunate position I'm in. But doing whatever you can to position your finances strategically before you start Social Security is an important factor in making the most of your benefits, whether you're claiming at age 70 or well before it.

The $22,924 Social Security bonus 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 ensure a boost in your retirement income.

One easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Join Stock Advisor to learn more about these strategies.

View the "Social Security secrets" »

The Motley Fool has a disclosure policy.

There's nothing easy about losing someone you care about, regardless of their relationship to you. Not only do you count on the important people in your life for emotional support, but you may also depend on them for financial support.

If you've lost someone and you're eligible for Social Security survivor benefits based on their work record, it's important to ensure you're receiving the support you deserve.

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The following questions are designed to help you determine if you're getting everything you're eligible for from your Social Security survivor benefits.

Image source: Getty Images.

Who's eligible?

According to the Social Security Administration (SSA), the following may be eligible for benefits after the loss of a loved one:

Spouses and ex-spouses

It's possible you're eligible if:

• You're 60 or older or 50 to 59 with a disability, and
• You were married for at least nine months before your spouse passed away, and
• You didn't remarry before age 60 (age 50 if you're living with a disability)
• You're a surviving spouse (of any age) who's caring for the child of the deceased, that child has a disability and is receiving Social Security benefits
• You're an ex-spouse who was married to the deceased for at least 10 years

Exception: The SSA reports that a person may be eligible for Social Security survivor benefits regardless of age or how long they were married. The example given is of a person who is caring for the child of the deceased.

Children

The child of someone who's died could be eligible if they're unmarried and are:

• Age 17 and younger, or
• Ages 18 to 19 and in school (K-12) full-time, or
• Any age if they developed a disability at age 21 or younger

Exception: Under specific circumstances, the SSA also pays benefits to married children, stepchildren, adopted children, grandchildren, and step-grandchildren.

Adult children with a disability

• An adult child with a disability that began before their 22nd birthday may be eligible for benefits.

Dependent parents

• Parents aged 62 or older who were financially supported by their child who died might be eligible.

As you can see, rules regarding who's eligible for benefits aren't written in stone, and the SSA looks at applications on a case-by-case basis. If you or someone you care about may be eligible for survivor benefits, it's important to apply.

How long can a caretaker continue to receive benefits?

If you're caring for the child or children of a deceased spouse, you're eligible to receive benefits to care for them until they reach age 16. At 16, the children will receive benefits based on their deceased parent's work record until they are 18 or 19, as long as they remain unmarried. If a child is a full-time student in high school when they turn 18, they will continue to receive benefits until they graduate or until two months after turning 19. If a child is disabled, they will continue to receive benefits after 18.

What if the deceased hadn't filed for Social Security?

You're eligible to collect survivor benefits even if your spouse hadn't claimed Social Security at the time of their death. If that's the case, your benefits will typically be based on the amount they would have received at full retirement age.

What if the deceased postponed retirement?

Unlike the spouses of still-living Social Security recipients, if your spouse postponed retirement to collect a larger benefit, your benefit as the surviving spouse will also be based on the higher amount.

Can someone file for their ex-spouse's survivor benefits if they've remarried?

If an ex-spouse dies but you remarry before age 60 (or 50 if you're disabled), you can't receive survivor benefits based on their work record unless the most recent marriage ends. However, if you remarry at age 60 or later, you can continue to receive benefits based on your former spouse's record.

If you did remarry at 60 or later, check your current spouse's estimated benefits to learn if they're higher or lower than the benefits you're eligible to receive based on your deceased ex's record. You cannot receive both, so apply for the higher of the two amounts.

How do I know how much I'll receive?

If you're a surviving spouse, you may receive full benefits at your full retirement age. However, you can receive a reduced benefit amount as early as age 60. If you receive survivor benefits before your full retirement age, the benefit amount will be permanently reduced.

Exception: If you have a disability, benefits can start as early as age 50.

The $22,924 Social Security bonus 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 ensure a boost in your retirement income.

One easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Join Stock Advisor to learn more about these strategies.

View the "Social Security secrets" »

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Congress recently confirmed President Donald Trump's pick, Dr. Mehmet Oz, to lead the Centers for Medicare and Medicaid Services (CMS). Medicare and Medicaid provide healthcare insurance to an estimated 136 million Americans, with Medicare serving citizens 65 and older and Medicaid covering lower-income populations. The appointment comes as healthcare remains expensive and out of reach for many Americans, and as Republicans try to figure out ways to improve the country's fiscal situation.

Oz previously served as the vice chair and professor of surgery at Columbia University, and also directed the Cardiovascular Institute and Complementary Medicine Program at the NewYork-Presbyterian Hospital. He's also published five best-selling books, and hosted his own television show and radio talk show.

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Here is what he's said so far about the Medicare and Medicaid programs.

What Dr. Oz said (or didn't say) about Medicaid cuts

Both Medicare and Medicaid have been big topics of conversation this year. The programs are enormously costly at a time when the U.S. government just ran a $1.8 billion deficit in fiscal year 2024, meaning it's spending more than the revenue it collects annually. Total U.S. debt now exceeds $36 trillion.

In late February, the U.S. House of Representatives passed a budget resolution that directed the agency overseeing Medicaid to find $880 billion in savings over the next decade. Many surmise this wouldn't be possible without cuts to Medicaid. Although Trump supported the resolution, he also publicly said that programs like Medicare and Medicaid would not be cut. Senate Republicans, however, have shown some pushback on potential actions that could lead to cuts to Medicaid.

So far, Oz has been tight-lipped on what he thinks about potential cuts to Medicaid, dodging questions during his hearings about the proposals. "I cherish Medicaid," he said, but it must be "viable at every level."

He did provide some comments on past changes to the program, such as its expansion under Obamacare. In one of his hearings, Oz said he supports work requirements for receiving Medicaid coverage, although he doesn't necessarily think paperwork should be a barrier for enrollment. He also said that the program was expanded without providing more resources to doctors, and that doctors don't like the program due to its lower payments.

These problems, among others, have left the program at a critical juncture. "We have to make some important decisions to improve the quality of care," said Oz, according to CBS.

Image source: Getty Images.

Thoughts on Medicare Advantage and Biden's changes

Medicare Advantage ("Part C") has long been controversial. The program allows private insurance companies to work with the government to provide all other parts of Medicare (A, B, and D) to citizens. Frequent complaints about Medicare Advantage allege that private insurance companies take advantage of the program, by cherry-picking healthier or younger patients and diagnosing patients with more issues in order to receive higher payouts from the government.

"There's a new sheriff in town," Oz said, according to The Wall Street Journal. He was critical of practices by insurance companies that overdiagnose: "I pledge if confirmed I will go after it." However, some senators felt uncomfortable with Oz's past on Medicare Advantage, because he has filmed videos on YouTube promoting the program. In 2020, he also penned an op-ed suggesting that Medicare Advantage could be used to provide healthcare to everyone, while putting the nation's healthcare system on a sounder fiscal footing.

Oz does seem supportive of work that CMS began under former President Joe Biden thanks to the Inflation Reduction Act, which let the agency begin negotiating prices on drugs frequently covered by Medicare and Medicaid.

In 2023, CMS negotiated lower prices on 10 drugs frequently used under Medicare and Medicaid that were expensive for consumers. Earlier this year, negotiations on another 15 drugs were announced. These negotiations are expected to save Americans billions of dollars in out-of-pocket expenses once they go into effect, starting next year.

Of the price negotiation program, Oz said: "It's the law. I'm going to defend it and use it."

The $22,924 Social Security bonus 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 ensure a boost in your retirement income. For example: one easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies.

View the "Social Security secrets" »

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If you're making good use of tax-advantaged retirement accounts such as IRAs and 401(k)s, good for you! They can be powerful helpers as you save and invest for retirement. You need to be aware, though, that once you reach a certain age, some of those accounts will make you take Required Minimum Distributions (RMDs).

Here's a look at what RMDs are, along with several critical things to understand about them. If you mess up with RMDs, the penalties can be quite costly.

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Image source: Getty Images.

Meet the Required Minimum Distribution

Our friend -- the Internal Revenue Service (IRS) -- requires people to take annual RMDs from accounts such as traditional IRAs, SEP IRAs, and SIMPLE IRAs once they reach the age of 73. When you do so, that income will count as taxable income to you -- so it's smart to account for it when you're devising your retirement plan. Failing to have a retirement plan is a big mistake. Here are seven others, all related to RMDs.

1. Missing the RMD deadline

First, don't be late! You have until April 1 of the year after you turn 73 to take your first RMD. After that, though, the deadlines fall on Dec. 31. So your second RMD will be due on Dec. 31 of the year you turn 74.

You might want to take your first RMD in the year you turn 73. Otherwise you face having to take both your first and second RMD in the same year, the year you turn 74. That can boost your taxable income a lot for that year.

2. Withdrawing the wrong amount -- or not withdrawing at all

When taking your RMD, you'll want to withdraw the correct amount -- at least. You can calculate your RMD by referring to an RMD table, but many good brokerages will calculate your RMDs for you and will often let you set up automatic withdrawals. That can help you avoid missing the deadline, though it's also smart to check now and then to ensure that your brokerage has indeed scheduled your RMD.

If you fail to take your full RMD on time, you'll likely pay a steep price. The penalty for not taking them on time is 25% of the amount you failed to withdraw on time. Fail to take out $6,000, and you may face a $1,500 penalty! (You may be able to pay a smaller penalty if you notice that you just missed the deadline and take action quickly.)

3. Not understanding how RMDs from IRAs and 401(k)s work

Here are some things to know about RMDs from various types of accounts:

• With Roth IRAs and Roth 401(k)s, you do not need to take RMDs.
• With traditional IRAs and with 403(b) accounts, if you have more than one account, once you total your RMDs from all of your accounts, you can withdraw that total sum from just one or from multiple accounts. So if your RMD for the year is $6,000, you could take all $6,000 from just one of your IRAs, or $2,000 from one and $4,000 from another, or some other combination.
• With traditional 401(k)s, you must take the RMD required from each one, and you can't mix and match as you can with IRAs.
• If you're still working, you may not have to take your RMD from your workplace's retirement account until you retire.

4. Thinking your spouse's RMD counts as your own

If you're married and both you and your spouse have RMDs to take each year, you can't withdraw from one of your accounts to satisfy the requirement for the other spouse. So, for example, if your RMD is $6,000 and your spouse's is $4,000, you can't take $10,000 from your account and consider theirs satisfied. Each of you will need to withdraw your own RMDs from your own account(s).

5. Donating to charity without considering a qualified charitable distribution (QCD)

If you donate to charity, you may be able to avoid being taxed on some or all of your RMD if you execute a "qualified charitable distribution" (QCD). Doing so means you would have funds sent directly from your retirement account to a qualifying charity. You cannot just withdraw the money and donate it and then expect to pay no taxes on the withdrawal -- the sum needs to go directly to the charity. There are some other rules, too, so read up on this if it's of interest to you.

6. Spending your RMD when you don't need to do so

Some people mistakenly think they have to take their RMD and spend it. That's not the case. You can always reinvest that money right away, parking it in shares of stock, certificates of deposit (CDs), or wherever you want.

7. Not keeping up with RMD changes

Finally, be sure to keep up with RMD rules, because they can change sometimes. For example, according to some new rules, some beneficiaries must take RMDs from inherited IRAs, depleting them within 10 years. This rule doesn't apply to spousal heirs, but does apply to most heirs who were not married to the IRA owner who died -- if that IRA owner had reached age 73 before dying.

The more you know about retirement accounts, RMDs, and tax matters, the more you may be able to save.

The $22,924 Social Security bonus 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 ensure a boost in your retirement income. For example: one easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies.

View the "Social Security secrets" »

The Motley Fool has a disclosure policy.

It's pretty difficult to turn on the TV or even scroll through your social media feed these days without seeing some mention of President Donald Trump. Whether you voted for him or not, you probably want to stay informed about the changes he's been making, especially if they will affect your finances.

This is especially true for retirees living on fixed incomes who often depend heavily on their Social Security checks. President Trump appealed to these voters during his campaign, promising to end Social Security benefit taxes so they can keep more of their checks.

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Image source: Getty Images.

This is still a work in progress. It'll take a new law from Congress to make such a major change. But that doesn't mean Social Security has been left untouched by President Trump's attempts to overhaul the federal government. He has made six Social Security changes so far, some of which have already gone into effect while others will come into play later in the year.

1. Facilitating the Social Security Fairness Act's benefit increase for 3.2 million seniors

Former President Biden signed the Social Security Fairness Act in his final days in office. This law eliminated two provisions, one that reduced benefits for retirees receiving pensions from employers that did not withhold Social Security taxes and the other for their family members. However, the Biden administration didn't have time to facilitate the benefit increases and the millions of dollars in back benefits the law called for. That fell to the Trump administration.

Though initially, the Social Security Administration (SSA) estimated it could take up to one year for the 3.2 million affected beneficiaries to receive the extra money they're now entitled to, it was able to automate much of this change. Most affected seniors received a one-time payment for any back benefits they were entitled to in March 2025 and will see a permanent benefit increase with their April 2025 payment.

There are some complex cases that the SSA couldn't automate. If yours is among them, you may have to wait up to one year to get the extra money you're owed. If your April payment is the same as your March payment and you think you should be entitled to more under the Social Security Fairness Act, contact the SSA.

2. Terminating some Social Security office leases

The Department of Government Efficiency (DOGE), a Trump administration initiative headed by billionaire Elon Musk, lists several Social Security office leases among its list of savings generated thus far. However, a recent SSA blog post clarified that the government hasn't permanently closed any local field offices.

It did close one hearing office in White Plains, New York, and it may temporarily close field offices due to bad weather or a facilities issue. If you're unsure whether any field offices near you are closed, you can use the SSA's Field Office Locator tool to check.

3. Reinstating the 100% overpayment recovery rate

In 2024, the Biden administration reduced the Social Security overpayment recovery rate to the greater of $10 or 10% of your checks. For example, if you received $1,000 in extra Social Security benefits due to a clerical error and couldn't pay it back right away, the SSA could withhold either $10 or 10% of your checks, whichever was larger, each month until it reclaimed the extra $1,000.

The Trump administration has reinstated the 100% overpayment recovery rate that was in place before the 2024 rule change. This will apply to all overpayments that occur on or after March 27, 2025. Overpayments that occurred before this date will retain the 10% cap, as will Supplemental Security Income (SSI) overpayments.

If you can't afford to lose your checks due to overpayment recovery, you can contact the SSA to request a lower recovery rate. You can also request a waiver of overpayment recovery. This may let you keep the extra money if you can prove to the SSA that the overpayment wasn't your fault and you can't afford to pay it back.

4. Expediting direct deposit changes

Changing your direct deposit information with the SSA used to take up to 30 days. Beginning in April 2025, these updates will now take just one business day. The easiest way to make these changes is to set up a my Social Security account, where you can view and update all your Social Security information.

5. Adding new identity verification requirements

Beginning April 14, 2025, it will no longer be possible to make account changes or complete new Social Security applications over the phone. You may begin the application process by phone if you prefer, but you must either use your my Social Security account or visit a local field office where you'll need to present your ID for verification to complete your application.

This rule will not apply to those signing up for Social Security disability benefits, Medicare, or SSI. These individuals will be able to complete their applications entirely over the phone if they're unable to do so through their my Social Security account.

6. Ending delivery of most paper Social Security checks

The Trump administration has announced that the SSA will end the delivery of most physical Social Security checks on Sept. 30, 2025. There will be exceptions for individuals without bank accounts into which the SSA can directly deposit checks.

It's not clear yet what steps, if any, you may have to take to continue receiving paper checks after Sept. 30 if you don't have a bank account. If you're currently receiving paper checks, you'll likely get more guidance on how the SSA will handle this as we approach the September deadline.

It's likely that we could see even more Social Security changes as we move deeper into 2025, including a possible end to Social Security benefit taxes on seniors. If bigger changes like this arise, seniors may need to take some time to review their budgets going forward.

The $22,924 Social Security bonus 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 ensure a boost in your retirement income. For example: one easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies.

View the "Social Security secrets" »

The Motley Fool has a disclosure policy.

Many of us are at least occasionally dreaming of retirement, looking forward to days when we won't have to clock in and work for someone else -- days when we can do more of what we want to do.

If you're counting down to your retirement and are looking forward to collecting Social Security benefits, make sure you're ready to do so. Here are some questions you might ask yourself.

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Image source: Getty Images.

1. Do you qualify for Social Security?

Let's start with some basics. Make sure you qualify to collect benefits. The bar is admittedly low. To be eligible for benefits, you need to earn a total of 40 credits, and you can earn up to four per year -- so you'll need to work and earn money for at least 10 years.

The value of each credit is updated annually, and for 2025, it's $1,810 -- which amounts to just $7,240 over the course of a year. Note that while you need to work at least 10 years, you'll want to aim for 35, because your benefit amount is based on your earnings in the 35 years in which you earned the most. Work for fewer years and some zeroes will get factored into the calculation.

2. Are you at least 62 years old?

Sixty-two is the earliest age at which you can claim your retirement benefits. Know that each of us has a "full retirement age" at which we can start collecting the full benefits to which we're entitled based on our earnings -- and that age is 66 or 67 (It's 67 for those born in 1960 or later.)

While you can turn on the Social Security spigot at age 62, doing so will result in smaller checks, though many more of them than if you claim late. If you delay starting to collect checks, they'll plump up by 8% for each year beyond your full retirement, until age 70.

The decision regarding when to claim your benefits is a big one, so think it through carefully. One study found that for 57% of people, waiting until age 70 will deliver the most total benefits.

3. Do you know how much to expect?

It's important to know how much to expect from Social Security, so that you can plan your retirement accordingly. Yes, the average monthly retirement benefit for retired workers was just $1,981 as of February -- only around $23,750 per year -- but you may well be in line to collect more.

To get a much clearer idea of how much you can expect from Social Security, set up a my Social Security account at the Social Security Administration (SSA) website. Then you'll be able to click in any time to see the latest estimates of your future benefits based on the SSA's records of your earnings.

If you don't like what you see, you're in luck -- because there are multiple ways to increase your Social Security benefits, beyond delaying claiming them. For one thing, while you're still working, try hard to earn as much as possible, even if that means a side gig for a while.

4. Are you able to retire?

It's also important to look beyond Social Security at your bigger financial picture, to see if you can retire. Don't assume that your nest egg will be sufficient until you crunch some numbers. For some people, retiring with a million dollars will be enough, for others it may be much too little -- or too much.

If you find that you're behind in saving and investing for retirement, there are several strategies to consider -- including delaying your retirement a bit.

5. Have you coordinated with your spouse?

If you're married, have you coordinated a Social Security strategy with your spouse? You might, for example, have the higher earner between you delay until age 70, in order to maximize their benefit. The lower earner might start collecting early, late, or somewhere in between -- whatever makes sense given your financial situation.

Why do this? Because when one spouse dies, the survivor will be able to collect whichever benefit is larger for the rest of their life.

6. Have you seen the news?

Finally, here's a somewhat new concern regarding Social Security. Not so long ago, I might simply have offered a warning that the program's surplus is turning into a deficit and if nothing is done to strengthen Social Security, its trustees estimate that beginning in 2035, beneficiaries will receive only 83% of what they're due. Yikes. (There are multiple ways to fix this problem, though.)

Now there's a new concern -- the Trump administration, which is making moves to change Social Security in ways that may leave it weaker, sooner. So it's worth keeping up with developments in the news as they may affect your future financial security. The more you know, the better your retirement plan may be.

The $22,924 Social Security bonus 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 ensure a boost in your retirement income. For example: one easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies.

View the "Social Security secrets" »

The Motley Fool has a disclosure policy.

There is a lot more to Social Security than the retirement benefits that tens of millions of retired workers receive every month. One extremely important part of the program is known as Social Security spousal benefits.

Spousal benefits can provide much-needed retirement income to married couples where one spouse was the primary earner. This is most common in situations where one spouse was a stay-at-home parent, but they can also apply in cases where one spouse was a high earner and the other worked part-time or earned comparatively little throughout their working life.

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Depending on the specific circumstances, a spousal benefit can be as high as one-half of the higher-earning spouse's full retirement benefit (formally known as their "primary insurance amount"). This means that if your spouse has a primary insurance amount of $2,500 per month based on their own work record, your spousal benefit can be as much as $1,250.

Qualifying for spousal benefits

Although the formula used to calculate Social Security benefits can be a bit complicated, the qualifications are not. This is true for spousal benefits as well. To collect a Social Security spousal benefit, there are three specific criteria that need to be met.

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1. Your spouse collects a retirement benefit

First and foremost, the central requirement of a spousal benefit is that the higher-earning spouse is actively collecting their own Social Security retirement benefit. Even if you've reached your full retirement age (more on that in a bit), you can't collect a spousal benefit until the primary-earning spouse applies for their own benefit.

It's also worth noting that even divorced spouses could potentially qualify for benefits, as long as the marriage lasted for at least 10 years.

2. You are at least 62 or have a child

To collect a spousal benefit, assuming the primary earner is collecting their own benefit, you need to meet one of two requirements:

• You must be age 62 or older
• You have a qualifying child under 16 or who receives Social Security disability benefits

Although you can get a spousal benefit as early as age 62, it will be permanently reduced if you start receiving it before full retirement age. For Social Security purposes, full retirement age is 67 for those born in 1960 or later. If you have reached full retirement age when you start collecting a spousal benefit, it will be equal to your spouse's primary insurance amount, regardless of how old they are when they start Social Security. But if not, your benefit can be reduced by as much as 35%, depending on how early you claim.

However, if you have a qualifying child (defined earlier in this section), the spousal benefit is not reduced for early retirement.

3. You don't qualify for a larger benefit on your own work record

Finally, when you apply for Social Security, the SSA will look at your own work record and see how much you would qualify for individually, if anything. And you'll get your own benefit or a spousal benefit, whichever is higher.

To be perfectly clear, a spousal benefit is paid instead of an individual Social Security retirement benefit, not in addition to it.

A valuable part of many couples' retirement strategy

As of the latest data, 1.86 million spouses of retired workers get a benefit, with an average monthly amount of $932 -- or approximately $11,200 of annual, inflation-protected retirement income.

The bottom line is that Social Security spousal benefits provide much-needed retirement income for married couples, and as long as one spouse qualifies for Social Security benefits with their own work record, qualification for spousal benefits is straightforward.

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From TV star to powerful government official. That's the path taken by President Donald Trump and his new administrator of the Centers for Medicare and Medicaid Services (CMS) -- Dr. Mehmet Oz.

Oz was a heart surgeon and medical school professor for years. He achieved fame thanks to frequent appearances on The Oprah Winfrey Show, which led to his hosting his own TV program, The Dr. Oz Show. Oz ran unsuccessfully for a U.S. Senate seat in Pennsylvania in 2022.

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But that didn't end his political career. The Senate officially confirmed Oz to head CMS on April 3. Here's what retirees need to know so far.

Image source: Getty Images.

1. Oz's confirmation went along party lines

All 53 Republican senators voted to confirm Oz to head CMS. None of the 45 Democratic senators voted for his confirmation. What were the minority party's objections to having Oz run CMS?

For one thing, some Democrats were concerned about Oz's potential conflicts of interest. He has disclosed investments in big drugmakers AbbVie and Eli Lilly and giant health insurer UnitedHealth Group, among others. These healthcare companies receive payments from Medicare. Oz did commit to divesting any financial interests in these companies.

There were also questions raised during Oz's Senate confirmation hearing about his past support for controversial therapies. For example, ranking Democratic member of the Senate Finance Committee, Sen. Ron Wyden of Oregon, asked Oz about his advocacy of green coffee extract, which the senator said was fraudently marketed as a "miracle weight-loss drug."

Probably the biggest objection to Oz's confirmation, though, was that he wouldn't commit to fighting attempts to cut Medicaid.

2. Oz has previously promoted Medicare Advantage

Oz has been a longtime proponent of Medicare Advantage plans. He and former Kaiser Permanente CEO George Halvorson proposed expanding Medicare Advantage because they believed it's better than traditional Medicare.

It remains to be seen how aggressively Oz will promote Medicare Advantage now that he's running CMS. During his Senate confirmation hearing, he promised to "go after" a fraudulent practice that can be problematic for Medicare Advantage called upcoding, by which healthcare providers file claims for more expensive procedures or diagnoses than the actual procedure or diagnosis to receive a higher reimbursement from Medicare.

3. What Oz says his Medicare priorities are

Oz acknowledged several problems for Medicare during his confirmation hearing, including the fact that healthcare costs are growing faster than the economy and that the Medicare Trust Fund will run out of money within the next decade. He told the told the Senate Finance Committee that he had three top priorities as the administrator of CMS.

First, Oz wants to "empower beneficiaries with better tools and more transparency, so the American people can better navigate their health, as well as dealing with the complex healthcare system we have created for them." He specifically mentioned increasing transparency related to prescription drug costs.

Second, he wants to provide incentives to healthcare providers to "optimize care." Oz thinks that using artificial intelligence (AI) can "liberate doctors and nurses from all the paperwork" and allow them to focus more on patients.

Third, Oz plans to aggressively reduce waste, fraud, and abuse with Medicare and Medicaid. The previously mentioned upcoding issue was one area that he discussed targeting.

4. There has been one Medicare surprise so far

Oz has been at the helm of CMS for less than a week. There has already been one Medicare surprise. On April 8, 2025, CMS announced a higher-than-expected payment increase for Medicare Advantage plans. It's unclear if Oz was involved in the decision, but the move could indicate that he'll continue his previous support for Medicare Advantage plans as head of CMS.

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Keith Speights has positions in AbbVie. The Motley Fool has positions in and recommends AbbVie. The Motley Fool recommends UnitedHealth Group. The Motley Fool has a disclosure policy.

If your spouse (or ex-spouse) is still alive and is due to receive Social Security benefits, it pays to look into how much you could receive. Here, we'll cover seven essential things you should know before filing for spousal Social Security benefits.

1. Basic eligibility rules

To be eligible to collect spousal Social Security benefits, the following must be true:

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• Your spouse must have claimed their own retirement benefits. As you'll see below, this rule does not necessarily apply for ex-spouses.
• You're 62 or older. However, there is an exception to this rule. You can collect at any age if you care for a child under the age of 16 or who has a disability and is entitled to benefits based on your spouse's record.
• You haven't earned enough work credit for a Social Security retirement benefit of your own, or you have earned a retirement benefit of your own, but the spousal benefit would be higher.

Image source: Getty Images.

2. How much you can expect to receive

Your benefit is 50% of the amount your spouse is eligible to receive when they reach full retirement age. For example, if your spouse is scheduled to receive $3,000 per month at full retirement age, your benefit would be $1,500.

If you decide to receive spousal benefits before you reach your full retirement age, your monthly benefit will be permanently reduced.

3. You can find the numbers you're looking for online

The Social Security Administration (SSA) makes all the facts, figures, and some of the services you're looking for available on their site. You only need to create a free and secure my Social Security account.

Here's a breakdown of what you can do with your my Social Security account:

• Get a personalized retirement benefit estimate
• Get proof that you don't receive benefits
• Check your application status
• Get your Social Security statement
• Request a replacement Social Security card
• Upload documents and submit online forms
• Set up or change direct deposit
• Get a Social Security 1099 (SSA-1099) form
• Print a benefit verification letter
• Change your address

4. Here's what happens if your spouse postpones taking Social Security

Let's say your spouse postpones taking Social Security until age 70 to earn delayed retirement credits and increase their monthly benefit. While they'll be collecting more in retirement, your maximum spousal benefit remains 50% of the amount they would have received if they'd retired at full retirement age.

5. What happens if your work record makes you eligible for benefits

If you're eligible for retirement benefits based on your own work record and spousal benefits, you'll need to apply for both. It's called "deemed filing" because once you apply for one of the two benefits, you're deemed to have applied for both. The SSA ensures that you receive the larger of the two benefit amounts.

Here's an example: One partner is eligible for a monthly retirement benefit of $1,500, and because their spouse is eligible to receive $4,000 at full retirement age, their spousal benefit would be $2,000. Since the spousal benefit is higher, that's the amount they receive.

According to the SSA, "If a spouse is eligible for a retirement benefit based on his or her own earnings, and if that benefit is higher than the spousal benefit, then we pay the retirement benefit. Otherwise, we pay the spousal benefit."

6. Divorced? Here's how to know you're still eligible for spousal benefits

Divorce doesn't necessarily mean you're no longer eligible for spousal benefits. Here's how to know you're eligible:

• You were married to your ex for at least 10 years.
• You're currently unmarried.
• You're at least 62.
• Your ex is currently receiving Social Security benefits, or they've reached retirement age and are eligible to receive benefits but have not applied. You can apply if you've been divorced for at least two years.
• If your ex has reached retirement age but hasn't applied for benefits, you can still apply if you've been divorced for two years or more.

7. You can apply online

Whether you're applying for your retirement benefits, a spouse's benefit, or both, the application can be completed online. If you're at least 61 years and 9 months old, visit the Social Security Administration's website to get started.

Planning for retirement is all about feathering your nest to the best of your ability. If collecting spousal Social Security benefits helps maximize your Social Security income, there's no question it's a win.

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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 ensure a boost in your retirement income. For example: one easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies.

View the "Social Security secrets" »

The Motley Fool has a disclosure policy.