Suspending your Social Security benefits as a way of boosting your retirement income can make sense in certain situations. But some readers who tried to follow this strategy say they have encountered problems from an unexpected source—Social Security representatives who either don’t understand how suspending benefits works or actually claim it can’t be done.
People who begin taking benefits between age 62 and their full retirement age (FRA)—66 for those born in 1943, rising to 67 for those born in 1960 or later—have the option of suspending benefits at their FRA. They can resume them at any time until benefits reach their peak at age 70. For those who defer Social Security benefits until age 70, your benefit will be 76% higher than if taken at 62, the earliest age that most people can begin claiming retirement benefits. Still, most people decide to take Social Security early because they need the money or cannot continue to work for medical reasons.
Even so, circumstances may change. Maybe a private pension kicks in, reducing the need for Social Security. Or your kids move out on their own, reducing household expenditures and the need for current income. Or maybe you simply want to walk back your decision to claim early, given the higher income you might receive by delaying—a survey last summer sponsored by Nationwide Financial found that nearly 40% of those who filed early for Social Security later regretted their move and wished they had waited. If so, suspending your benefits can be a smart strategy.
If you want to pursue this option, however, your first step is to become well informed—especially given the possibility you’ll encounter opposing views from Social Security representatives. That’s the problem one reader wrote me about:
As I told her, all the agent had to do was check his own web site to become informed. That doesn’t sound like too much to ask, does it?
While this agent did not know about suspending benefits, at least he didn’t provide the wrong information. Here’s an agent who did, according to another reader:
Now, I admit that being infallible is above my pay grade. But the right of this woman to suspend her benefits is not in question. And she doesn’t need to repay Social Security one penny of her earlier benefits. I urged the couple to do some homework and go back to their SSA office and try again:
Here are the official descriptions of the suspension rules from the Social Security Program Operating Manual System (POMS):
Everyone makes mistakes, and Social Security’s rules are very complicated. Further, the Social Security Administration has been hammered by budget cuts, forced to reduce staff, and close many offices around the country, as a Senate report last summer documented. That’s still no excuse for providing people with wrong or misleading information. But it further reinforces the need for people to learn the agency’s basic rules so they can look out for themselves.
Social Security, by the way, agrees. “If the situations you described are indeed accurate, they are unacceptable and we apologize for providing any misinformation,” agency spokeswoman Dorothy Clark said. “While our programs are complex, the vast majority of our employees provide accurate information. However, when we learn of these situations, we take action to correct the errors and provide further employee training.”
Philip Moeller is an expert on retirement, aging, and health. His book, “Get What’s Yours: The Secrets to Maxing Out Your Social Security,” will be published in February by Simon & Schuster. Reach him at [email protected] or @PhilMoeller on Twitter.
More on Social Security: