If you’re receiving Social Security benefits, you might be able to increase your monthly check by over 25%, even if you’ve already started claiming. This could greatly enhance your financial stability, especially as you age and face rising medical costs. Here’s how you can potentially boost your benefits and what you need to know.
Timing Matters
When to Claim Benefits
The amount of your monthly Social Security benefit depends on several factors, with one of the most important being the age at which you start claiming. If you claim benefits early, your monthly payments will be smaller. Waiting until you reach your Full Retirement Age (FRA) or even up to age 70 can significantly increase your benefits. For example, if you wait until age 70, you can get up to a 77% increase compared to claiming at age 62.
Regretting Early Claims?
If you started claiming benefits early and now wish you had waited, you can still make adjustments. There’s a way to increase your benefits by up to 28% even after you’ve started claiming. Understanding how the Social Security Administration (SSA) calculates benefits is key to making the most of this opportunity.
How SSA Calculates Benefits
Factors Affecting Your Monthly Benefit
The SSA calculates your monthly benefit based on:
- Total Career Earnings: The SSA reviews your earnings over your career.
- Birth Date: This determines your FRA.
- Claiming Age: When you start receiving benefits affects the amount you get.
The SSA adjusts your earnings each year to reflect the rise in the standard of living. They then average your highest 35 years of earnings to find your Primary Insurance Amount (PIA). If you claim at FRA, you receive 100% of your PIA. For those born in 1960 or later, the FRA is 67.
Impact of Your Birth Year
The table below shows how much of your PIA you receive based on your birth year and claiming age:
| Birth Year | Age 62 | Age 63 | Age 64 | Age 65 | Age 66 | Age 67 | Age 68 | Age 69 | Age 70 |
|---|---|---|---|---|---|---|---|---|---|
| 1943-1954 | 75% | 80% | 86.7% | 93.3% | 100% | 108% | 116% | 124% | 132% |
| 1955 | 74.2% | 79.2% | 85.6% | 92.2% | 98.9% | 106.7% | 114.7% | 122.7% | 130.7% |
| 1956 | 73.3% | 78.3% | 84.4% | 91.1% | 97.8% | 105.3% | 113.3% | 121.3% | 129.3% |
| 1957 | 72.5% | 77.5% | 83.3% | 90% | 96.7% | 104% | 112% | 120% | 128% |
| 1958 | 71.7% | 76.7% | 82.2% | 88.9% | 95.6% | 102.7% | 110.7% | 118.7% | 126.7% |
| 1959 | 70.8% | 75.8% | 81.1% | 87.8% | 94.4% | 101.3% | 109.3% | 117.3% | 125.3% |
| 1960 or later | 70% | 75% | 80% | 86.7% | 93.3% | 100% | 108% | 116% | 124% |
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
Delayed Retirement Credits
Even if you started claiming early, you can still boost your benefits. Here’s how:
- Suspend Benefits: After reaching your FRA, you can choose to suspend your benefits. This stops your monthly payments and allows you to earn delayed retirement credits. Each month you delay benefits, your amount increases by two-thirds of a percentage point.
- Automatic Resumption: If you don’t resume your benefits before age 70, they will automatically start again at that age with the increased amount.
Things to Consider Before Suspending
- Impact on Dependents: No one on your record (except a divorced spouse) will be able to collect benefits during the suspension. Your spouse will switch to their own benefit if eligible.
- Medicare Premiums: If you suspend benefits, you’ll need to pay Medicare Part B premiums out of pocket. Plan to cover these costs with your savings or other income.
Suspending your Social Security benefits to accumulate delayed retirement credits can significantly boost your monthly payments, especially if you claimed early. By understanding how the SSA calculates benefits and the impact of your claiming age, you can make informed decisions to maximize your Social Security income and enhance your financial security in your later years.
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.
How do Medicare premiums get paid if I suspend benefits?
You must pay Part B premiums out of pocket.
What factors affect my Social Security benefit amount?
Career earnings, birth date, and claiming age.