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Can you change your mind about claiming Social Security Benefits?

December 4, 2020

By Shelley W. Elovitz

The amount of money you receive from Social Security varies depending on when you begin your benefits. Generally, the longer you wait to claim, usually until age 70, the more you will collect. (Note: You may delay as long as you like, but you will not receive any increases after 70). But what if you claim your benefits and then you change your mind?

Surprisingly, you can change your mind but the method to do so varies depending on your age and whether you are above or below age 66, the full retirement age.

For those between ages 66 and 69

If you are at the full retirement age of 66 but not yet 70, you can ask to have your monthly benefits suspended. This will earn a delayed retirement credit for every month of suspension. When you choose to resume payments, you will receive a higher benefit. Benefit payments will start automatically at age 70 if you have not restarted them sooner.

For those under the age of 66

Option 1 – Within the first 12 months of being entitled to benefits, you can cancel your application and repay any benefits received to date. This is called a withdrawal and can only be used once.

Option 2 – If you return to the workforce, you can request an earnings test. The earnings test will reduce your monthly benefits to the extent your earnings exceed annual thresholds. In 2020, a beneficiary is subject to a reduction of $1 in benefits for every $2 of earnings above $18,240, and $1 for every $3 of earnings above $48,600. The $18,240 and $48,600 are adjusted each year to keep pace with national wage growth. This is recomputed monthly, which means the earnings test will automatically cut your benefits in the short term but raise them later, when they are more needed.

You CAN change your mind on when to collect Social Security Benefits, but do your homework!  Monthly benefits claimed at age 70 can be significantly more than those claimed at an earlier age, so if you are in the position to reevaluate, it can be well worth doing.