Retirees Can Temporarily Suspend Social Security After Reaching Full Retirement Age

Many Americans do not wait until age 70 to start Social Security. Some claim earlier because money is tight, then later realize they no longer need the benefit right away.

After reaching full retirement age, retirees may be able to suspend payments and increase future benefits. Here is how the option works.

What the Social Security suspension option means

People born in 1960 or later reach full retirement age at 67. Those born earlier generally reach it at 66 and several months, depending on birth year. At that point, Social Security allows you to pause retirement benefits. That is different from the reduction that applies when someone claims early and continues working full time, and it is also different from withdrawing an application within the first 12 months and starting over.

While benefits are suspended, no government checks are paid. But delayed retirement credits continue to build until age 70, which can lead to a larger monthly benefit for life. The option may appeal to people whose income has risen enough to cover expenses without Social Security.

How much the benefit can grow

For each year benefits are delayed after full retirement age, the monthly amount rises by 8% annually, plus inflation adjustments. The Social Security Administration says payments can be restarted at any time, or they will resume automatically at age 70.

That extra income can be valuable for those who can afford to wait. The downside is giving up monthly checks in the meantime, something not every retiree can manage.

The strategy can work well for people in good health who have other income sources and do not need the benefits immediately. It can also help a spouse if the higher earner delays, since survivor benefits are generally tied to whichever amount is higher.

What retirees should keep in mind

The biggest drawback is having to cover living costs without Social Security for as long as the suspension lasts. For people who have depended on those payments for years, the loss of income can be difficult to absorb.

Family members receiving benefits on the retiree’s record usually stop getting those payments during the suspension, though divorced spouses may be treated differently. Retirees may also need to pay Medicare Part B premiums directly to maintain coverage.

When benefits restart, there is no lump-sum payout. Instead, the retiree receives a higher monthly amount for the rest of life. Anyone considering this step should weigh health, income, Medicare costs and family-benefit effects, then contact Social Security before making a decision.