The Social Security system serves as a lifeline for tens of millions of Americans. With higher inflation these days, everyday expenses are up and Social Security income remains a crucial source of income for retirees. However, younger generations like Gen X don’t have it as easy as their predecessors.
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CNBC explained that Generation X feels less prepared for retirement than other generations despite approaching it sooner. Otherwise known as the “sandwich generation,” Gen X is stuck caring for both adult children and their aging parents at the same time.
What’s more? Gen X will have to wait longer to get their full Social Security benefit. Gen X will be the first generation to become eligible for full retirement benefits only once they reach 67 years of age, according to MoneyDigest. Older generations that have become before Gen X were able to claim full benefits as early as age 65 and 66 respectively.
With more financial responsibilities and having to wait longer to claim full benefits, there are some things that Gen X can do now to help increase their Social Security benefit.
Here are four things Gen X can do now to get a bigger Social Security check in retirement, according to Kiplinger, MoneyDigest and CNBC:
Work Until Full Retirement Age
Currently, full retirement age is set at 67. However, it’s possible to claim benefits as early as age 62, but you’ll only be eligible for 70% of your monthly benefit. As long as the retirement age isn’t changed between now and the time Gen X enters retirement, waiting until age 67 to claim benefits means they’ll be eligible for 100% of their monthly benefit for life.
Delay Claiming Benefits Until Age 70
If Gen X waits past age 67, they’ll be eligible for a higher benefit. Waiting until the maximum age of 70 to claim benefits will result in the highest monthly benefit for life which will mean more Social Security income. If you’re married, it’s best to have the breadwinner wait until age 70 to claim their full benefit, ensuring the highest combined Social Security benefit. Additionally, if the lower-earning spouse outlives the breadwinner, they’ll be eligible for the higher Social Security benefit after their spouse passes.
Put Extra Money In Retirement Accounts To Supplement Social Security
While Social Security can provide a financial cushion after you call it quits at work, it’s not always enough to make ends meet. Gen X needs to contribute early and often to their 401(k)s and IRAs to ensure that they’ll have enough funds. If your employer offers a percentage match on your 401(k) contributions, you’ll always want to contribute at least enough to get the full match while you’re employed. A healthy combination of income from multiple sources during retirement can provide more financial security and cash flow for the rest of your life.
Pay Down Debt Before Entering Retirement
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Debt eats a hole in your wallet and creates a drain on your finances. Ensuring that you reduce or eliminate all debts before entering retirement is crucial to your financial stability. Debt that continues well into retirement means that Gen X may have to allocate more of their Social Security income towards debt payments rather than everyday living and leisurely activities.
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This article originally appeared on GOBankingRates.com: 4 Things Gen X Can Do Now To Get a Bigger Social Security Check in Retirement
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