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Changing Your Mind About Receiving Social Security Early

Kevin Wenke

Kevin Wenke

CFP | CLU | Investing | Insurance | Taxes

Retirees have options to undo their decision if they feel they made a mistake taking Social Security retirement at an earlier age.

Imagine you decided to take your Social Security retirement income but as time went by you realize that you didn’t make the best decision.

Maybe you learned something new that proved that you should have waited longer or maybe your personal circumstances changed. 

Perhaps a new job opportunity that could have allowed you to continue earning credits to increase your payout later.

Before 2011, benefit recipients could make changes anytime before reaching age 70.  All they had to do is pay back all the benefits (money) that they received and then reapply at an older age receiving additional credits for the rest of their lives.

Those days are gone because that deal was WAY TO GOOD of a deal for the people who utilized that strategy so the government put a stop to it. 

I remember reading something at that time from the Social Security Administration that actually tried to sham people who did this implying that they were abusing the system by using a loophole.  It was legal and we used it often BECAUSE it made sense for our clients!

There are still some strategies available to Social Security Recipients who have changed their mind.  They are not quite as good but can still reverse a poor prior decision.

First of all, there is still a one time, one year provision that allows a Social Security Recipient to withdraw their application and have their future benefit calculated as if they never started them before.

All that the Social Security recipient has to do in those first 12 months is fill out the correct form and submit it to the Social Security administration along with all the money they received. 

That money includes everything paid out that was based on that retiree’s benefits, such as spouses, former spouses, children or parents.  This would also need to be repaid.  

If they do this, it will be as if they never applied in the first place and their benefits will continue to receive delayed credits up to the time they reach age 70.

As an added potential bonus, prior tax returns can be refiled removing the social security income which should include a refund based on the lower income.

If it is past 1 year, they can no longer restart by paying it all back.  However, what they can do is voluntarily suspend benefits.  If they suspend benefits, they will be penalized for the benefits that they have already received but can continue to earn delayed retirement credits for the remainder of time all the way to age 70. 

They can restart benefits at any time, but once they turn 70, their benefits automatically restart.  If a recipient delays their own benefit, any dependent benefits are likely also going to be delayed as well.

62 years old, is offered job that will pay them more that what the Social Security earnings test will allow.  I have met people who told me they didn’t accept the opportunity because it would have cost them to lose social security due to penalties but that is only a half truth.

The full truth is that you would only lose benefits THAT YEAR if you exceed the earnings test BUT you will in fact have the opportunity get those credits added back at full retirement.

So, in a way the benefits lost loses are equivalent of someone voluntarily suspending benefits. These benefits are not 100% lost like SO Many People Believe.  Instead, they are a way to force delay people that are still working from taking their benefits early.


Do you have doubts as to whether or not you made the best decision regarding the timing of your Social Security retirement? Decision Tree Financial’s Wealth Performance and Protection System helps you understand your choices so that you can make the best decisions regarding your money and future.

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