If you receive Social Security benefits, there’s a way to potentially increase your monthly check by over 25%, even if you have already claimed benefits. This opportunity can significantly impact your financial stability, especially as you age and face rising medical costs.
Contents
- 1 Timing Matters
- 2 Regretting Early Claims?
- 3 How SSA Calculates Benefits
- 4 Impact of Birth Year on Benefits
- 5 Boosting Benefits
- 6 Considerations Before Suspending
- 6.1 FAQs
- 6.2 How can I increase my Social Security benefits after claiming?
- 6.3 What is the impact of delaying Social Security benefits?
- 6.4 Can my spouse still collect benefits if I suspend mine?
- 6.5 How do Medicare premiums get paid if I suspend benefits?
- 6.6 What factors affect my Social Security benefit amount?
Timing Matters
The amount you receive each month depends on various factors, and one of the most crucial is the age at which you start collecting benefits. The earlier you claim, the smaller your monthly payment will be. Waiting until you reach your full retirement age (FRA) of 70 can lead to a 77% increase compared to claiming benefits at age 62.
Regretting Early Claims?
Many who have already claimed benefits might regret it, realizing the benefit of a larger monthly check later in life. However, there’s still a way to boost your benefits by up to 28%. To understand this, we need to delve into how the Social Security Administration (SSA) calculates your monthly benefit amount.
How SSA Calculates Benefits
Your monthly benefit is influenced by:
- Total Career Earnings: The SSA reviews your earnings record.
- Birth Date: This determines your FRA.
- Claiming Age: When you start receiving benefits significantly impacts the amount.
The SSA adjusts your earnings each year to account for the rise in the standard of living. It then averages your highest 35 years of earnings to determine your Primary Insurance Amount (PIA). If you claim at FRA, you receive 100% of your PIA. The FRA is 67 for those born in 1960 or later.
Impact of Birth Year on Benefits
The table below shows the percentage of your PIA you receive based on your birth year and claiming age:
| Birth Date | Age 62 | Age 63 | Age 64 | Age 65 | Age 66 | Age 67 | Age 68 | Age 69 | Age 70 |
|---|---|---|---|---|---|---|---|---|---|
| 1943 to 1954 | 75% | 80% | 86.70% | 93.30% | 100% | 108% | 116% | 124% | 132% |
| 1955 | 74.20% | 79.20% | 85.60% | 92.20% | 98.90% | 106.70% | 114.70% | 122.70% | 130.70% |
| 1956 | 73.30% | 78.30% | 84.40% | 91.10% | 97.80% | 105.30% | 113.30% | 121.30% | 129.30% |
| 1957 | 72.50% | 77.50% | 83.30% | 90% | 96.70% | 104% | 112% | 120% | 128% |
| 1958 | 71.70% | 76.70% | 82.20% | 88.90% | 95.60% | 102.70% | 110.70% | 118.70% | 126.70% |
| 1959 | 70.80% | 75.80% | 81.10% | 87.80% | 94.40% | 101.30% | 109.30% | 117.30% | 125.30% |
| 1960 or later | 70% | 75% | 80% | 86.70% | 93.30% | 100% | 108% | 116% | 124% |
As shown, waiting until age 70 can result in a monthly check that is 24% to 32% higher than your PIA, depending on your birth year.
Boosting Benefits
Even if you have already claimed early, you can still increase your benefits through delayed retirement credits. Here’s how:
- Suspend Benefits: Once you reach FRA, you can suspend your benefits. This stops your monthly checks and allows you to accumulate delayed retirement credits, which can increase your benefit by two-thirds of a percentage point for each month you delay.
- Automatic Resumption: If you do not resume your benefits before age 70, they will automatically start again at that age with the increased amount.
Considerations Before Suspending
Before suspending benefits, keep these in mind:
- Impact on Dependents: No one on your record (except a divorced spouse) will be able to collect benefits during the suspension period. Your spouse will revert to their own benefit if eligible.
- Medicare Premiums: Medicare beneficiaries must pay Part B premiums out of pocket if benefits are suspended, so plan to cover this expense from your savings or other income.
Suspending your Social Security benefits to accumulate delayed retirement credits can significantly boost your monthly earnings, particularly if you claimed early. This strategy can lead to increases of up to 28%, providing greater financial security in later years. Knowing how SSA calculates benefits and the impact of your claiming age can help you make informed decisions to maximize your Social Security income.
FAQs
How can I increase my Social Security benefits after claiming?
Suspend benefits at FRA to earn delayed retirement credits.
What is the impact of delaying Social Security benefits?
Increases benefits by up to 28% by age 70.
Can my spouse still collect benefits if I suspend mine?
No, except for a divorced spouse.
You must pay Part B premiums out of pocket.
What factors affect my Social Security benefit amount?
Career earnings, birth date, and claiming age.
