For millions of Americans, Social Security is a cornerstone of retirement. It provides a monthly financial lifeline after decades of work. But what many don’t realize is that the size of those checks can be seriously impacted by subtle, avoidable mistakes.
Whether you’re already receiving benefits or about to file, being aware of these hidden pitfalls could help preserve the income you’ve earned.
1. Claiming Benefits Too Early
One of the most common and costly errors retirees make is claiming Social Security benefits before full retirement age (FRA). While you can start collecting at age 62, doing so results in a permanent reduction of up to 30% in your monthly benefit. Waiting until FRA (typically 66 or 67, depending on birth year) or even up to age 70 can significantly increase your payout.
Example:
| Age Claimed | Percentage of Full Benefit Received |
|---|---|
| 62 | ~70% |
| 66/67 (FRA) | 100% |
| 70 | ~124% |
2. Underreporting or Not Earning Enough Credits
To qualify for Social Security, you need at least 40 work credits, which generally means about 10 years of employment. But the more you earn (up to the annual income cap), the higher your benefit. Low-income years or gaps in employment can reduce your average indexed monthly earnings (AIME), which is the basis for calculating your benefit.
Failing to accurately report income—particularly self-employed individuals who underreport to reduce taxes—can hurt future checks.
3. Ignoring the Impact of Taxes on Benefits
Many retirees are shocked to discover that their Social Security benefits may be taxed. If your combined income (adjusted gross income + nontaxable interest + half of your Social Security benefits) exceeds certain thresholds, up to 85% of your benefits could be taxable.
Thresholds for Taxation:
- Individual: $25,000 (50%), $34,000 (85%)
- Married Filing Jointly: $32,000 (50%), $44,000 (85%)
Strategic planning, like Roth conversions or managing withdrawals from retirement accounts, can reduce this tax burden.
4. Continuing to Work Without Understanding the Earnings Limit
If you claim Social Security before FRA and continue working, your benefits may be reduced if your income exceeds a specific annual limit. In 2025, the earnings limit is expected to be about $22,320. For every $2 over that limit, $1 is withheld from your benefit.
Once you reach FRA, there is no penalty, and your benefit will be recalculated to credit you for the withheld months.
5. Not Considering Spousal and Survivor Benefits
Married couples often miss out by failing to plan around spousal and survivor benefits. A lower-earning spouse is entitled to claim up to 50% of the higher earner’s benefit at FRA. Widows or widowers can receive the deceased spouse’s full benefit if it is greater than their own.
Poor coordination can lead to lost income, especially if the higher earner claims early, locking in lower survivor benefits.
6. Failing to Correct Earnings Record Mistakes
The Social Security Administration (SSA) tracks your income history to calculate your benefit. If your reported income is missing or incorrect, your benefits could be wrongly reduced. It’s crucial to review your Social Security Statement annually to ensure accuracy.
Corrections become difficult if too much time passes, so catch errors early.
7. Not Factoring in Medicare Premiums
Once you turn 65, Medicare Part B premiums are automatically deducted from your Social Security check. In 2025, the standard Part B premium is estimated to be about $175 per month, and higher-income retirees may pay more.
Failing to consider this deduction when budgeting for retirement could lead to unpleasant surprises.
8. Believing Social Security Alone Is Enough
Too many retirees overestimate what Social Security will cover. The average monthly check in 2025 is expected to be around $1,900—not enough for most to live on comfortably. Relying solely on these payments, especially after making any of the above mistakes, can put your financial security at risk.
Diversify your income sources and develop a solid retirement plan with a financial advisor.
In Summary
Social Security is complex, but mistakes don’t have to be inevitable. Whether it’s claiming benefits too early, ignoring the tax implications, or failing to coordinate spousal benefits, each error can shrink your monthly checks for the rest of your life. Review your earnings history, consult with a professional, and make informed decisions to maximize what you’ve earned over a lifetime of work.