Increasing Social Security benefits is a common goal among boomers and there are three ways to do it. In part one of this series we discussed Cost-of-Living Adjustments (COLA), part two Earning More, and part three Delaying the Start of Benefits. But what if you have already filed for Social Security and started collecting benefits? In this article we will discuss ways you can increase your benefits if you have already filed.
How Long Has It Been Since You Filed?
If it’s been less than 12 months since you filed, you can withdraw your application, repay the benefits you collected, and start over later.
If it has been more than 12 months since you’ve filed, or if you don’t want to go through the trouble of withdrawing and repaying, you can simply go back to work at a high enough salary that all of your benefits will be withheld (roughly $60,000 per year or more).
When you turn full retirement age, the benefit will be recomputed to add back in the actuarial reduction for those months in which a benefit was withheld. At this time you can voluntarily suspend your benefit to earn the 8% annual delayed credits on the amount of the benefit at the time of suspension.
A Look at the Numbers
There have been cases where a client filed for Social Security at 62, received just one or two checks, and then went back to work. Because the benefit will be suspended—automatically from 62 to Full Retirement Age (FRA) and voluntarily from FRA to 70—they will end up with nearly the same benefit as if they had initially waited until age 70 to file.
It’s never too late to change your mind and rethink your initial decision to claim before full retirement age. You need to make sure that you speak with someone about your options and fully understand the benefits and the requirements to make it work for you.
There may be more ways to increase your Social Security income if you also qualify for spousal benefits, divorced- spouse benefits, or survivor benefits. It’s also important to recognize that, while we’ve outlined some general rules of thumb in these articles, there’s no guarantee the advice here works well within the context of your overall financial plan and greater retirement goals. For customized help, visit a financial advisor who has the calculation tools necessary to analyze your individual Social Security claiming situation.
Mark Singer, CFPⓇ, President of Safe Harbor Retirement Planning, has been recognized for his vision and creativity within the world of financial planning. He has been in the industry for over three decades, is the author of three books, and is a frequent speaker. Request a free copy of the 2019 Social Security Quick Reference Guide, which gives you key Social Security numbers to help you in planning, here. Get in touch with Mark at 781.599.2660, mark@55retire.com, and 55retire.com. This content was developed in conjunction with Elaine Floyd, CFP®.
Subscribe on YouTube