Most Americans who are approaching retirement have no idea how many ways there are to leave Social Security money permanently on the table. The mistake at #1 on this list has already cost some retirees more than $100,000 over the course of their retirement. Don’t file a single form until you’ve read every entry on this list.
21. Filing the Moment You Turn 62
You can claim Social Security at 62, but doing so locks in a permanent reduction of up to 30% on every check you ever receive. That reduction doesn’t go away when you hit full retirement age. It stays for life. Most people file early because they’re nervous about the money, not because they’ve done the math. One retired nurse from Indiana told me she wishes someone had stopped her at 62 and shown her what that early filing would actually cost over 20 years.
20. Not Checking Your Earnings Record
Your Social Security benefit is calculated from your 35 highest-earning years. If your earnings record contains an error, you’re being paid less than you’re owed, possibly for decades. The Social Security Administration does make mistakes. Errors from early jobs, name changes, or employer reporting failures are more common than most people realize. You can review your full earnings history for free at ssa.gov. Most people never do.
19. Ignoring Spousal Benefits
If you’re married, you may be entitled to up to 50% of your spouse’s Social Security benefit instead of your own, whichever is higher. Many lower-earning spouses file on their own record without ever checking whether the spousal benefit would pay more. This is a free upgrade that requires no extra contributions. You simply have to know to ask. Thousands of couples leave this money unclaimed every single year.
18. Assuming Divorced Spouses Have No Options
If you were married for at least 10 years and have been divorced for at least two years, you may be eligible to claim spousal benefits on your ex-spouse’s record without affecting their benefit at all. This applies even if your ex has remarried. Many divorced Americans have no idea this option exists. The Social Security Administration will not volunteer this information. You have to know to ask.
17. Working While Collecting Early Benefits
If you claim Social Security before full retirement age and continue working, the SSA can withhold $1 for every $2 you earn above the annual earnings limit ($22,320 in 2024). Many early claimants don’t realize their benefits will be reduced mid-year when they cross that threshold. They then get a surprise overpayment notice in the mail. The good news: withheld benefits are added back once you hit full retirement age. The bad news: the timing shock catches most people off guard.
16. Not Understanding the Tax Torpedo
Up to 85% of your Social Security benefit can be taxable if your combined income exceeds certain thresholds. Many retirees trigger this by taking large IRA withdrawals on top of their Social Security. This “tax torpedo” can push you into a higher bracket right when you can least afford it. The threshold that triggers taxation hasn’t been adjusted for inflation since 1993, which means more retirees hit it every year. Your tax advisor needs to know your Social Security income before you take any IRA distributions.
15. Claiming Without Knowing Your Full Retirement Age
Full retirement age (FRA) is not 65. It’s 66 or 67, depending on your birth year. Millions of Americans still believe 65 is the magic number because that’s what it was for decades. Claiming before your actual FRA means a permanent reduction. Claiming after FRA means delayed retirement credits that increase your check by 8% per year up to age 70. Getting this number wrong by even one year can cost you tens of thousands over a long retirement.
Read More: 19 Retirement Planning Mistakes Financial Advisors See Every Year
14. Not Maximizing Delayed Retirement Credits
Every year you delay claiming past full retirement age, your benefit grows by 8% per year, guaranteed. By age 70, this can add up to a 32% increase over your FRA benefit. For someone whose FRA benefit is $2,000/month, that’s $2,640/month at 70, a difference of nearly $640 every single month. If you’re in good health and have other income sources to bridge the gap, delaying to 70 is one of the most reliable ways to increase your lifetime Social Security income. Most people don’t wait. Most people should.
13. Missing the Widow/Widower Benefit
Surviving spouses can receive 100% of a deceased spouse’s benefit if that benefit is higher than their own. This is called the survivor benefit, and it’s one of Social Security’s most powerful provisions. Widows and widowers can also switch between their own benefit and the survivor benefit at strategic times to maximize total lifetime income. Many grieving spouses never receive proper guidance on this from the SSA. One retired teacher from Texas told me she lost more than $18,000 over five years before a financial planner finally explained the strategy.
12. Ignoring Benefits for Dependent Children
When you start collecting Social Security retirement benefits, dependent children under 18 (or under 19 if still in high school) may also qualify for a benefit based on your record. This also applies to children with disabilities regardless of age. Many families with late-in-life children or grandchildren they’re raising miss this entirely. The SSA doesn’t always proactively notify you. The monthly payments per child can easily reach $600-$900, and they don’t reduce your benefit.
11. Not Coordinating Benefits as a Couple
For married couples, Social Security is a two-player game and most couples play it like two separate single players. The higher-earning spouse delaying to age 70 dramatically increases the survivor benefit for the lower-earning spouse. The lower-earning spouse can claim early to bring in income while the higher earner waits. Done right, coordinated claiming can add $100,000+ to lifetime household Social Security income. Done wrong, it’s money left permanently on the table.
10. Assuming Social Security Will Cover Your Retirement
The average Social Security benefit in 2024 is around $1,907/month. That’s $22,884 a year. The average American household spending in retirement is closer to $50,000. Treating Social Security as your primary income source is a plan to struggle. It was never designed to be the whole answer. It was designed to supplement a pension and personal savings that most Americans no longer have. The gap between what Social Security pays and what retirement actually costs is where financial hardship begins.
Read More: 27 Signs You Are Not Actually Ready to Retire
9. Not Appealing a Benefit Denial or Reduction
Social Security disability and survivor benefit claims are denied at a rate above 60% on first application. Most of those denials are successfully appealed. The vast majority of denied applicants never appeal. They simply accept the decision and walk away from benefits they were entitled to. If you’ve been denied a Social Security benefit of any kind, consult a Social Security attorney immediately. Most work on contingency, meaning they don’t get paid unless you win. This is one of the clearest cases in retirement planning where doing nothing has a direct dollar cost.
8. Failing to Plan for Medicare Premium Deductions
Medicare Part B premiums are deducted directly from your Social Security check. In 2024, the standard premium is $174.70/month. But if your income exceeds certain thresholds, you’ll pay IRMAA surcharges, up to $594/month at the highest income levels. Many retirees don’t factor Medicare costs into their Social Security income planning at all. The result is a check that looks much smaller than expected, starting the first month of retirement. A two-year lookback period means your 2022 income affects your 2024 premiums.
7. Miscalculating the Break-Even Point
The break-even analysis for Social Security is the calculation most people get wrong. If you claim at 62 instead of 70, you get more years of smaller checks. At some point, the total value of waiting crosses the total value of claiming early. That crossover point is typically around age 78 to 82. If you live past that age and you claimed early, you’ve left money on the table permanently. With life expectancy for a 62-year-old American currently around 83, the math often favors waiting more than most people think.
6. Not Checking for Government Pension Offset (GPO) and WEP
If you receive a pension from a government job that didn’t pay into Social Security (common for state teachers, police, and federal employees), two rules can significantly cut your benefits. The Windfall Elimination Provision (WEP) can reduce your own Social Security benefit. The Government Pension Offset (GPO) can reduce or eliminate a spousal or survivor benefit. Many public sector workers reach retirement with no idea these rules apply to them. Finding out at 65 is not when you want to discover your expected benefit is half what you planned.
5. Ignoring Social Security’s Online Tools and Free Services
The SSA’s online portal at my.ssa.gov shows your complete earnings record, projected benefit amounts at different claiming ages, and customized estimates based on your actual work history. Most Americans have never logged in. The tool is free, takes 10 minutes, and can directly inform a decision worth thousands of dollars per year. If you don’t know what your projected benefit is at 62, 67, and 70, you are making one of the most significant financial decisions of your life completely blind.
4. Voluntarily Stopping Work Too Early
Social Security calculates your benefit from your 35 highest-earning years. If you stop working early and have fewer than 35 years of earnings, each missing year is counted as zero. Zeros bring down your average and permanently reduce your benefit. If you’re 58 with 30 years of earnings, working five more years at even a modest salary can meaningfully increase your lifetime benefit. Voluntarily leaving the workforce before 35 earning years is one of the most overlooked ways people quietly shrink their own Social Security checks, often without knowing it.
3. Underestimating Longevity Risk
The average American underestimates their life expectancy by about five years. If you’re a 65-year-old woman today, there’s roughly a 50% chance you’ll live past 87. A 65-year-old couple has about a 50% chance that at least one of them will reach 92. Claiming early because you think you’re not going to live very long is a bet most people lose. The families that optimize Social Security for longevity, coordinating spousal benefits, delaying the higher earner to 70, and planning the survivor strategy, almost always come out significantly ahead. The penalty for underestimating how long you’ll live is paid in smaller checks for every remaining year.
2. Not Getting Professional Advice Before Filing
Social Security claiming decisions are permanent and irreversible after 12 months. After that window closes, you cannot undo your filing date. The strategies available to you, coordinating with a spouse, timing around Medicare, factoring in pensions, considering survivor benefit implications, require professional analysis, not a 15-minute conversation with an SSA representative who is not a financial advisor. A fee-only Social Security specialist typically charges $200 to $500 for a personalized claiming analysis. For a decision that affects decades of monthly income, that is one of the highest-ROI hours you can spend before retirement. Treating this as a decision you can figure out on your own has cost many retirees far more.
Bad. But nothing compared to what’s waiting at #1.
1. Claiming at the Wrong Age Without Running the Numbers
The Costliest Retirement Mistake of Them All
The single most expensive Social Security mistake is the one almost no one talks about openly: filing at the wrong age because you never actually ran the numbers. Not filing early because you were sick. Not filing late because you were strategic. Filing at whatever age felt most instinctively right, or at whatever age a family member mentioned, or at whatever age the SSA representative happened to suggest when you called to ask a different question.
The difference between claiming at 62 and claiming at 70 can be $500 to $1,000 per month, for the rest of your life. For someone who lives to 85, that gap represents anywhere from $78,000 to over $150,000 in lifetime benefits. The money is already yours. It’s sitting there. The only question is how much of it you actually collect.
One retired electrician from Ohio told me he filed at 63 because his father had died young and he assumed he would too. He’s now 84 and still collecting his reduced check every month. He estimates the early filing cost him more than $120,000 compared to waiting until 70. “I didn’t do the math,” he said. “I just guessed.”
Don’t guess. Run the numbers. Use my.ssa.gov. Talk to a fee-only advisor. Social Security is the largest guaranteed income source most Americans will ever have, and the decision about when to claim it deserves more than a gut feeling and a phone call.
Now you know why we saved this one for last.
The Decisions You Make Today Will Follow You for Decades
Social Security isn’t complicated once you know the rules, but nobody explains the rules to you before you file. The SSA’s job is to process your claim, not to maximize your benefit. That part is entirely on you. Forward this to anyone you know who’s been putting off their Social Security planning. These aren’t edge cases. These are the mistakes that are happening right now, to people who thought they had it figured out.
