Social Security is a federal program that provides retirement, disability, and survivor benefits to eligible Americans. It’s an important source of income for many retirees, and it’s essential to understand how the system works to maximize your benefits. In this article, we’ll review the basics of Social Security, including how benefits are calculated and strategies for maximizing your benefits.

The Social Security system is based on a formula that considers your earnings history, the number of years you’ve worked, and the age at which you choose to begin receiving benefits. Your benefit amount is calculated by taking an average of your highest-earning 35 years and adjusting it for inflation. Generally, the longer you work and the higher your earnings, the higher your benefits will be.

One of the most important strategies for maximizing your Social Security benefits is to delay taking them until you reach your full retirement age (FRA). Your FRA will depend on your birth year, generally between 66 and 67. If you begin taking benefits before your FRA, your benefits will be permanently reduced. However, if you delay taking benefits until after your FRA, your benefits will be increased by a certain percentage. The increase will be the largest if you wait until age 70 to take your benefits.

Another way to maximize your benefits is to consider spousal benefits. If you’re married or have been married for at least ten years, you may be eligible for spousal benefits equal to 50% of your spouse’s benefit amount. This can be especially beneficial if one spouse has a higher earning history than the other.

It’s also essential to consider coordination between spousal benefits, which maximizes the overall benefits for the couple. One strategy can be for one spouse to claim benefits at full retirement age while the other delays benefits until age 70.

It’s important to note that Social Security benefits are subject to federal income taxes; this could be another factor to consider when deciding when to take your benefits.

Lastly, realize that this can be a complicated, and sometimes overwhelming, process. Consulting with a financial advisor can help you evaluate your unique financial situation and provide customized advice on maximizing your benefits, and ensuring you have the income you need during your golden years.