Why Delaying Social Security Can Boost Your Monthly Benefit

The increase retirees should pay attention to is the larger benefit that can come from waiting to start retirement checks. The COLA only adjusts benefits each year for inflation. It does not create additional spending power; it mainly helps retirees avoid falling behind as prices rise.

By contrast, postponing a Social Security claim raises your monthly benefit permanently for every month you wait past the earliest age of 62. That increase comes either from avoiding the penalties that apply when benefits are claimed before full retirement age (FRA) or from earning delayed retirement credits for each month you wait after FRA.

Delaying a claim does more than lift the size of the monthly check. Research has shown that it can also improve the chances of collecting the most lifetime benefits. In some cases, waiting until age 70 can add hundreds of thousands of dollars in extra lifetime spending power.

How much can your Social Security payment grow?

The amount of the increase depends on how long you postpone claiming.

For example, if your full benefit at FRA would be $2,000, that is your primary insurance amount. Claiming at 62 with an FRA of 67 would cut that amount to $1,400 because of a 30% early-filing reduction. Waiting until 70, however, would raise the payment by 24%, bringing it to $2,480 a month.

That is an increase of $1,080 per month, and the age-70 benefit is a little more than 77% higher than the age-62 benefit.

This kind of increase can make a real difference in retirement. If you can delay claiming and do not expect to die before you recoup the value of waiting, it is worth seriously considering holding off as long as possible, ideally until benefits are maxed out at 70.

If you have already retired, it may still be possible to improve your benefit. If it has been less than 12 months since you claimed, you may be able to withdraw your application if you repay the benefits received so far. If you have already reached FRA and can afford to do so, you can suspend benefits and begin earning delayed retirement credits that will increase your future payments.

These choices are worth weighing if a larger Social Security check would improve your long-term financial picture.