Current:Home > ScamsRegret claiming Social Security early? This little-known move could boost checks up to 28%-InfoLens
Regret claiming Social Security early? This little-known move could boost checks up to 28%
View Date:2024-12-23 14:32:19
Claiming Social Security early gets you more checks from the program, but it often results in reducing the total benefits you collect over your lifetime. Applying as soon as possible at 62 can shrink your monthly check by up to 30% (compared to what you're eligible for at full retirement age).
Not everyone realizes this before they sign up, and that can lead to major regret. There are ways to undo an early claim, but they have their drawbacks too. Here's what you need to know.
If you change your mind within the first year of claiming
The Social Security Administration gives you a one-time do-over if you change your mind about claiming Social Security benefits within 12 months of signing up. You must contact the Social Security Administration and request that it withdraw your application. Then, you must also pay back any benefits you or other family members claiming on your record have received from the program thus far.
If you're able to do this, the government will treat it as though you never applied for benefits. When you sign up later, your checks will be larger, and this could increase your lifetime Social Security benefit.
But for most people, paying back all the benefits they've already received and likely spent isn't possible. Even if you can do this, it's not an option after you've been on Social Security for over a year. That said, there's still another way early claimers who regret their choice can boost their checks.
If you change your mind after a year
Even if you've been receiving Social Security checks for several years, you can suspend your benefit starting at full retirement age (FRA). By doing so, the government stops sending you checks until you request them again, or you reach 70 (the age when people qualify for their maximum Social Security benefit).
You add two-thirds of 1% to your benefit for each month you suspend them. This adds up to 8% per year. Those with a FRA of 67 could add up to 24% to their checks by delaying until 70. Meanwhile, those who most recently hit their FRA as of this writing have the opportunity to grow their benefit 28% by suspending until 70.
Let's say you qualify for a $2,000 monthly benefit at your FRA of 67. But you claimed Social Security at 62, which shrunk your checks to $1,400 per month. For five years, you receive that amount, but at 67, you suspend benefits.
Assuming you patiently wait for the next three years, your benefits will grow 8% per year, so when you resume your benefits at 70, you'll then get $1,736 monthly ($336 more per check).
It's still not as much as you could have gotten if you'd never claimed Social Security in the first place, but it's an improvement that could increase your lifetime benefit by thousands of dollars.
The trade-off
The obvious downside to both of these strategies is the need to cover your expenses on your own during the years you're not claiming Social Security. You might be able to pull this off if you have a lot of personal savings, or you're still working a job that provides steady income. But it's not feasible for everyone.
If you cannot afford to withdraw your claim or go without benefits for years, consider delaying just a few months to grow your checks as much as you can. Or you could settle for the benefit you have right now. Your checks might not be as large as you'd hoped, but they'll still grow over time through cost-of-living adjustments (COLAs).
The Motley Fool has a disclosure policy.
The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY.
The $22,924 Social Security bonus most retirees completely overlook
Offer from the Motley Fool: If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known "Social Security secrets" could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies.
View the "Social Security secrets" ›
veryGood! (58)
Related
- Timothée Chalamet Details How He Transformed Into Bob Dylan for Movie
- 2024 College World Series: Highlights as Texas A&M beats Kentucky for trip to semifinals
- Retail sales rise a meager 0.1% in May from April as still high inflation curbs spending
- Get free iced coffee from Whataburger in honor of the summer solstice: Here's what to know
- California Gov. Gavin Newsom will spend part of week in DC as he tries to Trump-proof state policies
- Carl Maughan, Kansas lawmaker arrested in March, has law license suspended over conflicts of interest in murder case
- An anti-abortion group in South Dakota sues to take an abortion rights initiative off the ballot
- An anti-abortion group in South Dakota sues to take an abortion rights initiative off the ballot
- Taking stock of bonds: Does the 60/40 rule still have a role in retirement savings?
- McDonald's to end AI drive-thru experiment by late July, company says
Ranking
- Shocked South Carolina woman walks into bathroom only to find python behind toilet
- Firefighters gain ground against Southern California wildfire but face dry, windy weather
- NFL Commissioner Roger Goodell defends ‘Sunday Ticket’ package as a premium product
- Sean Diddy Combs returns key to New York City following mayor's request
- Homes of Patrick Mahomes, Travis Kelce burglarized, per reports
- A woman may be freed after 43 years for a grisly murder. Was a police officer the real killer?
- Small plane with 1 aboard crashes into a Massachusetts river
- Why Brooke Shields Wore Crocs to the 2024 Tony Awards
Recommendation
-
Get well, Pop. The Spurs are in great hands until your return
-
Remains of missing 8-month old found hidden in Kentucky home; parents arrested
-
Summer Clothing You Can Actually Wear to the Office
-
Summer Clothing You Can Actually Wear to the Office
-
Jason Kelce Jokes He Got “Mixed Reviews” From Kylie Kelce Over NSFW Commentary
-
Georgia father freed from prison 10 years after his toddler died in hot car, leading to murder case
-
GOP claims Trump could win Minnesota, New Jersey, Virginia in 2024 election. Here's what Democrats say.
-
Rebellious. Cool. Nostalgic. Bringing ‘The Bikeriders’ to life, and movie theaters