Social Security Myth #5: Even if you claim early, you get a “boost” once you reach full retirement age
Many believe there is an “added income” or a “bump up” once they reach their FRA. Well, that’s another Social Security myth that we’re about to debunk. According to this misconception, you can claim early at age 62, and then when you’re 66 or older, your monthly checks will increase to the amount that corresponds to your FRA benefit.
The truth is, once you’ve claimed your retirement benefit, your income will stay the same, so there is no bump up. However, anyone receiving a benefit has the option to “suspend” that income after they reach the full retirement age and resume it as late as age 70.
If you do so, your annual benefit will increase by 8% for each year you postpone it until age 70. After that, you receive an annual cost of living adjustment but nothing extra on your base benefit, which you will automatically receive starting with the month you reach age 70 (unless you decide otherwise).
You can usually cancel your Social Security claim, but you can only do that within the first 12 months of receiving retirement benefits. In this case, you’re required to pay back the full amount you were given as well as the full amount a family member or current spouse received based on your benefit.
Then, you qualify to claim again at a later date and will get a larger monthly payment. Each person can only cancel a Social Security claim once in their lifetime.
Which Social Security myths were you actually believing in? Let us know in the comments section!
You may also want to read 5 Nontaxable Sources of Income in Retirement.
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