Key Takeaways
- Some people regret their decision to claim Social Security early, well before their full retirement age (FRA). Fortunately, a "do-over" option is available.
- If you claimed early and now have the financial resources to reconsider, you can still potentially boost your annual or monthly benefit by up to 24% by suspending your Social Security for 1 to 3 years after you reach your FRA.
- If you have longevity in your genes and have the financial resources to pay for expenses from sources other than Social Security, this retirement income strategy could significantly boost your lifetime income.
You've probably heard about the common myth that everyone is required to claim Social Security at age 62. The reality: You can claim your inflation-adjusted Social Security income anytime between age 62 and 70. The longer you wait, the greater the monthly benefit.
If you decide to claim early, then are you stuck with that decision? - Not necessary. Social Security allows you to change your mind once during the first year of receiving benefits, but you have to pay back everything you've already claimed that year.
What if you have second thoughts after the first year? Good news: There's a little-known strategy to readjust your Social Security claim and produce additional guaranteed lifetime income. It's called "claim-suspend-restart"—CSR.
"Some people claim Social Security early even though it may not be in their best interest. In fact, 58% of people claim before their full retirement age (FRA)," says Brad Koval, director of Financial Solutions at Fidelity. "However, CSR may be a good strategy if you can afford to forgo some payments for 1 to 3 years in exchange for a greater payout of guaranteed income in later years."
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