Social Security Strategies: How to Help Maximize Your Retirement Income

By Andrea Zoeller, CFP®, NSSA®, Area Director, Wealth Manager, Partner, Merit Financial Advisors

Without Congressional action, significant reductions to Social Security are imminent. Most Americans are unprepared for these changes.

The 2026 NFP U.S. Retirement Trend Report shares a disconcerting update: “69% of employees do not feel confident they will retire comfortably, 72% report being off track in their retirement savings goals, and 46% say they are deprioritizing retirement savings or unable to save at all.”

It’s clear that Social Security is no longer the primary safety net it once was and should now be considered a supplemental income source. To strategize effectively, younger individuals should increase their savings, while older adults need to plan benefit timing carefully to ensure a comfortable retirement.

What Has Changed About the Social Security Program Over the Past Few Years?

Two recent changes have affected Social Security. First, the projected solvency issue is now expected in 2032, rather than 2034. This challenge is not new; similar issues arose during the Reagan Administration, with more people drawing from the system than contributing. Without legislative action, such as raising the retirement age or increasing revenues, the Trust Fund will be depleted, resulting in a 20% to 24% automatic reduction in benefits.

Second, the 2025 Social Security Fairness Act removed the windfall elimination provision and government pension offset, benefiting public sector and municipal employees such as teachers, police officers, and firefighters. However, this change impacted only a small group of recipients, with some seeing benefits increase by several hundred dollars to $1,000 per month.

Supplemental income from sources such as 401(k)s, IRAs, pensions, or other long-term savings accounts is essential as both the cost of living and life expectancy rise.

Will Social Security Run Out?

It is a misconception that Social Security will run out entirely, as it is funded by both the Trust Fund and payroll taxes. Payroll taxes provide about 80% of benefits, while the Trust Fund covers the remaining 20%.

However, the program is under increasing strain. With more Baby Boomers exiting the workforce and longer life expectancies, individuals are drawing benefits for extended periods. When Social Security began in 1935, most people contributed for several years and collected benefits for only a short time, as life expectancy was much lower. Unused benefits accumulated, creating the trust fund that now subsidizes current recipients.

Though no action is currently planned, Congress could address solvency by raising payroll tax caps and increasing the retirement age.

How can you make the most of Social Security benefits?

Your strategy for managing Social Security benefits should be tailored to your age.

Those nearing retirement should discuss the optimal time to begin receiving Social Security benefits. Once you start, you cannot stop benefits unless you act within the first 12 months and repay the full amount received. If you are receiving benefits while working and have not reached retirement age, be mindful of earnings limits.

Younger generations, including Millennials and Gen X, may not receive full program benefits but have the advantage of time. Save as much as possible, as early as possible. By working with an advisor, future Social Security benefits can be projected, accounting for potential reductions.

What common Social Security mistakes do people make?

There are four common mistakes people make when considering how Social Security benefits will factor into retirement.

First, drawing benefits too early is a frequent error. While age 62 is the earliest you can begin, waiting longer increases your benefits. Claiming early can reduce your total benefits by up to 30%.

Second, failing to secure adequate supplemental income is a common oversight. Ensure you have sufficient savings in other accounts to support yourself if you delay Social Security or stop working.

Third, failing to project your future needs can undermine your retirement planning. Begin by assessing your family situation, marital status, age differences, desired retirement lifestyle, and estimated longevity.

Finally, one of the biggest mistakes to make is not consulting a financial professional about your options. The Social Security office does not provide scenario planning, but wealth advisors can offer strategic guidance. For example, widows may benefit from activating survivor benefits, especially if both partners have worked. It is important to determine which account to draw from first, allowing the other to grow, and later switch to the higher benefit. Not doing so can result in significant financial loss.

Social Security benefits remain an important part of retirement planning, though the program will likely change in the future. Do not rely on it as your sole source of retirement income, as no government replacement currently exists.

Curious about how to factor Social Security into your retirement planning? Merit Financial Advisors offers complimentary consultations to help bring clarity and structure to your financial life. Let’s start the conversation today.