Delaying Social Security after Stopping Work

Some baby boomers are asking the question of what happens to their Social Security retirement benefits if they stop working but do not claim benefits until later.

The answer to that question depends on how many working years you have in the system.

Your Social Security retirement benefit is based on your average monthly earnings during the thirty-five years you earned the most.  (Your actual earnings are adjusted to account for changes in average wages since the year the earnings were received.)   So, if you have at least thirty-five years in the Social Security system, stopping work should not affect your benefit amount.

Of course, if you want to increase your benefit by increasing your average earnings, you will have to continue to work and have an income that exceeds the average.   Depending on what your average earnings are compared to your current salary, that may not have much of an impact.  You can investigate that by using the Social Security Online Benefit Estimator and plugging in different compensation levels for the most recent year.

Ignoring the average earnings issue, delaying benefits will increase your benefit level until you reach age 70. Also, working after claiming benefits at age 62 can temporarily decrease your benefit.

Bottom line is that not working for a period of time before claiming Social Security retirement benefits should not cause your benefit amount to which you were entitled to when you quit work to go down.  (But watch out for changes in the law in the coming years!)

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