The Hidden Cost of Three Social Security Mistakes.

Don’t leave money on the table: three mistakes—claiming too early, ignoring spousal/survivor strategies, and not accounting for taxes or the earnings test—are the most common ways people make costly mistakes with their Social Security income.

Why this change matters now

Social Security choices are often irreversible and interacting rules (taxation, earnings limits, spousal rules) can change the net benefit you actually receive each month. Getting the gross check is only part of the story; taxes and benefit withholding matter for cash flow and planning.

1. Claiming benefits too early (or without a plan)

What happens: Filing as early as possible at age 62 locks in a permanently reduced monthly benefit compared with waiting to your Full Retirement Age (FRA) or delaying to 70.

Impact: Early claiming can reduce lifetime income substantially, especially for couples and those with longer life expectancy.

How to avoid it: Model break‑even ages and factor in personal and family health history, work plans, and other income sources before filing.

2. Not coordinating spousal, survivor, and divorced‑spouse options

What happens: Couples often file independently without considering spousal or survivor strategies that maximize household lifetime benefits.

Impact: Poor coordination can reduce combined lifetime benefits and leave a surviving spouse with far less income.

How to avoid it: Map both spouses’ benefit trajectories and consider delaying the higher earner to grow the survivor benefit.

3. Not accounting for taxes and the Social Security earnings test

What happens: Social Security benefits can be taxable at the federal level depending on combined income, and if you work while collecting before FRA, the earnings test can temporarily withhold benefits.

Impact: Withholding or unexpected taxes reduce monthly cash flow and can make early claiming far less attractive than it appears on paper.

How to avoid it:

• Estimate your provisional income to see whether up to 85% of benefits may be taxable at the federal level.

• If you plan to work before FRA, calculate how much the earnings test could withhold and whether withheld amounts will be credited later (they often increase your benefit at FRA).

• Factor taxes and withholding into your claiming calculations rather than comparing gross benefit amounts only.

Quick checklist before you file

• Run claiming scenarios for ages 62, FRA, and 70 including tax and earnings-test effects.
• Coordinate with your spouse and check divorced‑spouse or survivor rules.
• Review your Social Security Statement for earnings accuracy (still important) and keep tax records handy.
• Consult a financial planner or Social Security expert for complex situations (pensions, continued work, divorce).

Social Security is one leg on the retirement income stool, but it is often the only leg that is backed by the US Government, inflation adjusted and can benefit up to two lives and sometimes dependents.  Make your social security decision part of a plan.  Don’t wing it and, surely, don’t make it apart from your investment and tax strategy.  Plan Wisely, Retire Happy

Any opinions are those of Landon Vick and not necessarily those of RJFS or Raymond James. The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete; it is not a statement of all available data necessary for making an investment decision and it does not constitute a recommendation. Raymond James and its advisors do not offer tax or legal advice. You should discuss any tax or legal matters with the appropriate professional. Be sure to contact a qualified professional regarding your particular situation before making any investment or withdrawal decisions.