How to Maximize Your Social Security Benefits in 2026

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1.16.26: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.

Speaker1:
Hey, this is Sam Davis with active wealth management and retirement results. Before we jump into today's episode, a quick note for our podcast listeners. This episode is all about what you need to know about Social Security this year. It's 2026. It's hard to believe, but there's some important things you need to know if you're going to receive Social Security in the near future. And we recorded this one as a full video presentation as well. If you want to see the charts, visuals and all the walkthroughs that Ford references during this conversation, we highly recommend you go over to YouTube. It's the same content, but with the full presentation on screen, so you can follow along step by step for those listening on the go. Thank you for being a podcast listener. If you want a complete visual breakdown, head over to YouTube search Retirement results and we'll see you there. Now let's get started.

Speaker2:
Any examples used are for illustrative purposes only, and do not take into account your particular investment objectives, financial situation or needs and may not be suitable for all investors. It is not intended to predict the performance of any specific investment, and is not a solicitation or recommendation of any investment strategy.

Speaker3:
Welcome to Retirement Results, the national radio show and podcast for listeners like you who want to protect and grow their hard earned money. In a world filled with so much uncertainty and financial risk, we seek to cut through the noise and build successful plans for hard working Americans on their road to financial freedom. Retirement results is powered by Active Wealth Management, a team of fiduciary advisors who always place your needs first and now your host. He's a registered social security analyst, member of the Forbes Finance Council, and author of multiple books on retirement planning. Here's your chief financial advisor, Ford Stokes.

Speaker4:
Hey, welcome to retirement results. I'm Ford Stokes, your chief financial adviser. And on today's show, we're going to do everything we can to help you maximize your Social Security income on retirement results. Our goal is to help you build a tax efficient, fee efficient, and market efficient portfolio for your retirement. We also try to do a great job at building and growing your income during retirement. Beyond that typical 4% withdrawal rate. Let's get into it. I want to bring in Sam Davis, our senior financial advisor, and cohost the show. Sam. Hello, everybody.

Speaker1:
Welcome to the show, everybody. It's been great to connect with you. Uh, whenever you're watching this, uh, we just flipped over the calendar to a new year. And Ford, now's a great time for people to really be thinking about a lot of these things. Uh, I've got a lot of folks hitting us up, calling the office, sending me emails. They're trying to get their New Year's resolutions going. And for a lot of people, it's getting their retirement plan in order and to a place where it's better than it's ever been before.

Speaker4:
Yeah, we've been the most listened to radio show on Am 910, The answer on the weekends and in Atlanta, Georgia. And now our goal. What we're trying to do now is to try to really build our podcast and really reach more people than ever before. We've got 20,000 something downloads over the last few months, and we're so excited to share this information with you. So let's get right into how to maximize your Social Security income, starting with the correct Social Security income planning. So here's some of the problems that Americans face with Social Security. There's over 2700 different rules and thousands of different claiming options. Uh, there's also SSA prohibited all their folks from giving personal claiming advice. They are not fiduciaries. They're there to work for. The Social Security Administration doesn't make them bad people. They're just really busy. Um, and also, there's also a few, very few other reliable resources. We are two Matt McClure, myself, um, who's also an advisor with our practice. We're two of 23 actual rsas in the state of Georgia. Um, so we're almost 10% of the entire registered Social Security analyst population in the state of Georgia. So we're pretty busy running these Social Security maximization reports that are called RSA roadmaps. We're happy to help you get started on that. And what you want to do is just click the link that's um, with this actual video or also reach out to us at Retirement results.

Speaker4:
Com or active Wealth.com and we'll get started right away. You can even put your information in at retirement results plan. That's retirement results. Com forward slash plan. So here's some Social Security facts for you. It's more than just a retirement program. When it started during the Roosevelt years it started as a retirement plan for low income wage earners. And now it's become either number one or number two source of income for retirees in, you know, throughout the United States. And so you really need to do a great job at maximizing your income during retirement. And the best way to do that is to start with maximizing your Social Security, because that has nothing to do with the financial markets. Next is this is why all retirees need help. 96% of Americans actually do not optimize their Social Security whatsoever. The average loss per household is about 111,000 over the life of their retirement years, so that's a really big deal. Also, another reason why this is such an urgent situation now is there's 11,200 of you retiring each and every day, turning 65, turning 66, 67, getting your full retirement age. And now you're trying to figure out, do I turn on income or do I go all the way to 70? What do I need to do? And you want to try to actually start thinking about retirement, really enjoying your retirement years.

Speaker4:
Here's the approach. Social security planning is literally the foundation for your retirement finances. And let's get going on that. So qualifying for benefits. Here's what you need to know to be eligible. You got 40 credits. So it's basically like working ten years over four different quarters. So that would give you 40 credits, one credit for actual um, taxes that are paid into FICA. Um, would be uh, $1,810. Uh, that would equal one credit. So employee and employer FICA payroll tax contributions, those are the things that actually qualify you as a credit. It's money that gets paid into the Social Security Administration. The 2025 maximum taxable earnings for this, this 2025 year going into 2026 is $176,100. So once you've reached that, they're no longer going to take out the The 6.2% um, for your FICA. And also the wage index factor adjusts past earnings, uh, to age 60 years old. All right. Let's talk about how we're going to calculate your primary insurance amount or your Pia. So let's say you've got 3,150,000 in some index earnings. Then we're going to go ahead and divide that over your top 35 earning years or 420 months. We're trying. Our goal is to take your top 35 earning years. Put it in there and divide by the number of months. And that's going to give you us your aim your average income, monthly earnings. And then we're going to have bend point calculations as well.

Speaker4:
So here's let's figure out what your Pia is. They're going to give you 90% of the first $1,226 that you earned on average per month. They're going to they're going to give you 90% of the first 1226. Then they're going gonna. Then they're only going to give you 632%. They're going to take 68%. They're going to give you only 32% all the way up to 7391. So from 1226 up to 7391, they're only going to give you $0.32 on the dollars of what you earned on that one. Then going from 7391 up to your aim of 7500, they're going to give you 15% of that. So a lot of people talk to me and say, am I better off just not necessarily saving, but just just working longer and putting more money into Social Security or you're not. And also if you're making more income in the later years where you're actually not getting all that money. And so I would tell you, do a great job at saving as well. Okay. The next slide here. So retirement deductions and credits. So most folks if you're born after 1960 congratulations your full retirement age or your Fra is 67 years old. If you're born before 1960, you could be at like 66 and eight months or 66 and ten months, or 66 and six months. Um, but we really try to encourage folks to try to get to their full retirement age, if possible.

Speaker4:
You also get 8% more a year each year that you wait for your full retirement age up to age 70. That's what we call like a roll up, an 8% roll up. Also spousal benefits. You get to up to 50% of a spouse's primary insurance amount. Let's say the the woman, the wife stayed home and took care of the kids and worked harder than the male probably did. But because of the job, she couldn't get fired from and she couldn't quit. Um, but that her also, you cannot start getting spousal benefits until your spouse actually files their own benefits. Um. That's one. And then also, um, if you're divorced, you need to be married ten years to be eligible. Um, so let's just make sure you understand that you need to be married for ten years. For sure. Survivor benefits. Um, you gotta be married for nine months or more when your spouse passes away. If you're for divorce, um, survivor benefits, you gotta be married for ten years or more. And also not remarried before age 660. So there's good to go there. And then also the widow's limit is 82.5% of the Pia. If you're going to turn on income, as you can see, um, your survivor benefit, if you're turning it on early would be at age 60. It would be 71.5. At full retirement age, you're getting, um, 100%, um, of the 50%.

Speaker4:
So just something to think about. Their cost of living adjustments. The Cola, you can see we had 2.8% before Covid. We had 1.6% in 2020, but then it starts ramping up to 5.9%. And and in 2023, it was 8.7. When the government was really printing money and now it's back down to a normal level. So we're excited that that's the case. But it is good to get this cost of living adjustment so you can keep a little bit of pace with inflation for sure. Also, I get questions a lot. Hey am I still going to get this cola if I haven't turned on the Social Security income? You absolutely are. Even if you're delaying the benefits, you're going to get the benefit of this cost of living adjustments as well, because it's going to be built inherent into your numbers as well for your own income benefit. Here's the, um, people are just living longer. The CDC and the Social Security Administration and also this JP Morgan asset. Basically they're saying, like for couples, at least one lives to be over 80 years old. You're looking at 89% chance that 89% chance that at least one of you live to be at least 80. Um, believe it or not, with a couple, if you both make it to age 65, um, there's a 47% 47% chance that at least one of you live to be age 90.

Speaker4:
So you need to you do have longevity risk. You need to plan for the future and make sure that you don't outlive your money. Make sure that your money outlives you, and that Social Security income is going to be a big factor in that. Also, for you women out there, women in Social Security, you really need to understand what your Social Security planning is. You need to be engaged and involved with it. Don't just let your husband make the decisions on Social Security. Here's a here are the stats on it. Likely the you're going to live longer than your husband. Historically, a lot of women have had lower earnings. Often women marry older men. I personally I'm married to a woman who's seven. My my wife Diana, she's seven years younger than me. Um, and so likely she's going to live longer than me and she's younger. So it could be a a 14 year to 20 year longer than I'm going to live. Um, also, you're the women are likely the survivors. So you really need to understand what your Social Security is going to be. And if Social Security is truly a case of what you don't know can really, really hurt you. Also, um, dual entitlement, where you only collect the higher of the two amounts on your retirement, your own retirement benefit, you can file if you're a spouse and you want to hey, I want to file my own benefit.

Speaker4:
Um, and then you can top off to the higher spousal or survivor amount later. Each benefit reduction um, and credits calculated separately. Um, but I would encourage you to consider turning on your Social Security income on your own. Let's say it at age 63 and then turning on the spousal benefit at age 67, then earnings tests, um, Yeah. From age 62 to your full retirement age, um, they're going to tax one in every $2 from age 62 to, say, age 67. If you're born after 1960, then, um, at your full retirement age and after they're going to tax one in every three earned above 62,160, there's no limits at or after the month of your full retirement age. Um, and also one pitfall be very careful about overpayments, because they will call those back overpayments. When a beneficiary receives more money for a month than they should have been paid. Um, a lot of times you're unaware of the limitations. Especially young widows are unaware they returned to work, maybe, or after previously retiring and misunderstood the first year rule of monthly limits. Um, so the other benefits are. The other thing is they can take benefits away with Social Security, um, SSDI, with disability. Also, if you're convicted of a criminal offense. They may call that back. So just be careful about overpayments. Here's options. If you're collecting.

Speaker4:
Now let's say you wanted to further delay benefits. You could withdraw your application. You've got a 12 month window after 12 months. Congratulations. You're actually committed to that Social Security income benefit. Um, you can also volunteer voluntarily, suspend, um, at your full retirement age or older. And you can also accrue delayed retirement credits, let's say if you're still working, but also if you just if you suspend it and you're going to wait, um, that you will still accrue, um, more delayed retirement credits and you'll get a higher payout later if you decide to, um, suspend for a while. Here's an example of a couple with a primary insurance amount difference. So let's say Paul is is, um, Paul and Alice, you've got they're both age 62. Full retirement age is 67. Life expectancy is right around 85. Paul's pia is 3000oz, 1000. Let's go to the next. So Paul claims benefits at 2100. And Alice claims it's at 62. She's going to get 975. That's $3,075. But if they both wait to age 67, they're going to make almost $1,500 more. They're going to make $1,425 more per month. That's going to buy a lot of groceries. So if you can wait the four and a half years between age 62.5 and age 65, age 67, that could be a really good situation for you. Here's the maximize strategy. Um, Alice would claim retirement at full retirement age and collect $1,000 a month or $12,000 a year.

Speaker4:
Um, claim spousal benefit at age 70 when Paul files. Um, that's a really good way to optimize that as well. Um, one other quick point on your for spousal benefits. It does you no good to files a spouse at age 68 or 69, because your benefits are not going to go up. It's going to only go to your full retirement age at 67. So I would encourage you to make sure you're filing at 67 or earlier for spousal benefit after your spouse has filed theirs. Here's a couple with an age difference. John, 62, Lisa's 57, five years age difference. The optimal strategy actually netted us 68 $147 per month benefit. Go ahead Sam, this is the kind of thing you're going to get from us. You're going to get a John, and you're going to get a heat map that shows. So John's across the top axis, and then the vertical axis is Lisa. And the optimized strategy of Lisa files at 65 and John files at 70 years old. And one thing we get a lot of is questions on how do I download my XML file forward so I can give you my XML file so I can give you my top 35 earning years. So you or Matt can do the calculations. I'd encourage you to go to ssa.gov, click your Social Security statement and then go ahead.

Speaker4:
Same to the next slide. Then you want to select Download Data as an XML file. It's two lines down below the PDF download link of your Social Security statement. Just click Download Statement Data as an XML file that allows us to get your top 35 earning years, because Social Security Administration is aggregating decades into your those PDF files, and it is 5% to your detriment. Also, if you want to email me your XML files to a secure email, I'd go ahead and I'd go ahead and encourage you to go ahead and send me an email at Ford at com. So also, here's what's going on with the big beautiful bill. There's income limits for the $6,000 Social security tax, state tax credit. So for single filers, um, you get full credit if, uh, if you're below $50,000 in adjusted gross income, uh, partial credit phase out is at between 50,000 to 75,000. You get no credit, anything above 75 grand. And for couples, it's $150,000. So be careful and also try to keep you're going to make more money if you're still making that kind of income. I wouldn't dictate your entire lives about trying to get that Social Security tax credit. I'd go ahead and get the income. It's going to be a better impact for you. Um, one thing that we see a lot is there's a serious impact on what's going on with Social Security taxation.

Speaker4:
So imagine if you've got a pension, you've got RMDs, and you've got total provisional income and 90,000 a year. So your Social Security tax bill would be 7480 a year. But if you go to the next slide, you'll see that you've actually got. Here's the result. So Tom and Alice, they actually had to take more money out of their IRA. And in a 22% tax rate just to get to the 7480. They owe the IRS on their Social Security taxation. They have to take out $9,589 to compensate for the taxation for Social Security alone. Imagine what would happen if that money had stayed in the account year over year. It would really grow. We need to do a great job at doing Roth conversions, but also maximizing our Social Security income. If you want to maximize your Social Security income. I'd encourage you to reach out to us. You can send me an email at forward com. You can also visit retirement. Plan. That's retirement. Com forward slash Plan. That's probably the best way to do it is just to reach out to us at retirement. Com forward slash plan. Sam, you work with a lot of clients who on their retirement income, and you're maximizing retirement income with bond replacement strategies and others. How important is that social Security number and that that monthly number for Social Security for all of your clients planning when you're running those overall financial plans?

Speaker1:
Oh, well, it's absolutely critical. I mean, you said at the beginning of, of this, uh, presentation here, it's it's one of the most, you know, important income sources for most retirees in the United States and for us as advisors and people who are really trying to help people get not just to retirement, but through retirement. Social security is really the cornerstone of that plan. Uh, this is really a portion of a full workshop that we do at libraries and different places around the state of Georgia. And the next thing that we go into is the retirement income gap. We take a look at, hey, what's that maximized Social Security number that you can get. When is the ideal time for you? Because everybody's situation is different. Not everybody can afford to wait until their full retirement age or age 70. So we figure out what's best for you and your situation. These reports that we prepare, uh, that you prepare for. And Matt, uh, registered social security Analyst they are personalized to each person who comes to us with help for their retirement. We take a look at what you're going to get from Social Security. And from there we look at the difference between that and what your monthly budget is. And that is going to lead us to, okay, how can we make sure that all the income you need each and every month for the rest of your retirement, for the rest of your life is going to be coming on a guaranteed basis, that's going to relieve a lot of stress, and it's going to free people up to make much more intelligent decisions about their finances as they take this important step into retirement.

Speaker4:
Yeah. Again, for everybody watching this. Thanks so much for watching us for a little over 20 minutes. I'd encourage you to go ahead and invest a little bit more time. Go to retirement plan, submit your information, your name, email and phone. We'll reach out to you. We'll get started right away on your Social Security maximization report in the form of an RSA roadmap, and get the heat map and all the other things you saw in this presentation. But I encourage you to go ahead and reach out to us to maximize your Social Security income, get that foundation for your retirement income. And also we'll give you strategies on how to maximize your income, uh, beyond just the 4% typical withdrawal rate. A lot of advisors are saying it's just 3.2%, um, withdrawal rate now, um, and you won't run out of money over your retirement years. A lot of people can't live on, say, 3.2% times $1 million. They really can't live on that. And so we want to try to maximize it with their Social Security income, and also try to get you other strategies to get you potentially up to 10% of what you put in in principle, four years later, with bond replacement products that only 1% of financial advisors have access to. If you want to learn more about those financial products that are really exclusive and proprietary, I'd encourage you to go ahead and reach out to us at wealth.com or visit Retirement Plan, and we'll get started right away on your Social Security maximization report and your financial plan. Your 95th birthday. Thanks so much for watching retirement results. And also listen to us on the podcast. Have a great week everybody.

Speaker3:
Thanks for listening to Retirement Results. You deserve to work with an independent team of fiduciary advisors that will strategically work to protect and grow your hard earned assets. To schedule your complimentary financial consultation, call us now at (770) 685-1777. That's And 777 to connect with a qualified advisor. To learn more about our mission and our team, visit retirement Results.com Investment Advisory Services offered through Brookstone Capital Management, LLC, a registered investment Advisor. Bcm and Active Wealth Management are independent of each other. Insurance products and services are not offered through BCM, but are offered and sold through individually licensed and appointed agents. Investments involve risk and, unless otherwise stated, are not guaranteed. Past performance cannot be used as an indicator to determine future results.

Speaker2:
Registered investment advisors and investment advisor representatives act as fiduciaries for all of our investment management clients. We have an obligation to act in the best interest of our clients and to make full disclosures of any conflicts of interest. Please refer to our firm brochure, the advertised item four. For additional information not affiliated with or endorsed by the Social Security Administration or any other government agency. Information provided is not intended as tax or legal advice and should not be relied on. As such, you are encouraged to seek tax or legal advice from an independent professional.

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