When individuals opt to claim Social Security benefits before reaching their full retirement age (FRA), they accept a decrease in their monthly payments. The standard benefit amount acknowledges the FRA as the point where full benefits can be collected, and claiming benefits prior to that milestone results in a monthly payment reduction. These reductions can be substantial, with a decrease of up to 6.7% per year for the first three years before FRA, along with an additional 5% reduction for years claiming even earlier.
For those who find that claiming early has significantly lowered their expected Social Security income, various strategies exist to potentially increase monthly payments down the line. Not every individual will be eligible or able to utilize all the available options, but understanding these approaches can be beneficial for boosting retirement income.
1. Rescind Your Social Security Claim
One direct method to recover lost benefits after filing is to withdraw the Social Security claim entirely - but this option is time-sensitive and conditional. Individuals who have claimed benefits less than 12 months ago may request a withdrawal of their application, effectively undoing the claim. To proceed with this route, the claimant must repay all Social Security benefits received during that period. This repayment also extends to any spousal benefits that might have been collected based on the claimant's work record.
Successfully rescinding the claim resets the benefit calculation. When the claimant resumes benefits after rescinding, payments will be determined as if the initial early claim never took place, eliminating any prior reduction. This option can be advantageous for those who recognize promptly that early claiming was detrimental to their long-term income.
2. Continue Working to Offset Benefit Reductions
For individuals younger than their full retirement age, ongoing employment and income can play a role in restoring some of the benefits lost due to early claiming. However, this strategy does not apply to those who have already reached FRA, as work no longer impacts benefit amounts once full retirement age is attained.
Under current Social Security rules for 2026, there are earnings limits that influence the benefits paid before reaching FRA. If the claimant will not reach FRA during the calendar year, the annual earnings cap is $24,480. If FRA will be reached during the year, a larger limit of $65,150 applies.
For those under FRA, there is a deduction of $1 in benefits for every $2 earned above the $24,480 threshold. For those turning FRA within the year, the reduction is $1 for every $3 earned over the $65,150 cap. These limits are subject to periodic adjustments to reflect inflation.
By earning above these thresholds, recipients may reduce or forfeit their Social Security payments temporarily. Yet, this decision is not without purpose. The Social Security Administration recalculates monthly benefits upon reaching FRA, crediting back withheld benefits that were lost due to earnings. Thus, working and forfeiting some benefits before FRA can result in a higher future monthly benefit.
3. Boost Earnings to Improve Benefit Calculation
Another mechanism available regardless of age involves increasing one's earnings relative to prior career income. Social Security benefits calculations use an individual's average indexed monthly earnings over their highest 35 years of earnings.
Even after beginning to receive benefits, if an individual continues to work and earns more income than in previous years included in their 35-year calculation period, their overall benefit can increase. This is because the Social Security formula will replace lower-earning years with higher ones, thereby raising the average and, consequently, the monthly benefit.
Additionally, earning more income while working post-claiming can also enable greater contributions to retirement savings such as 401(k) accounts. Simultaneously growing these savings alongside Social Security benefits strengthens retirement readiness and income stability.
4. Transition to Spousal or Survivor Benefits
A final option entails switching to alternative benefit categories, specifically spousal or survivor benefits, if one is eligible. These benefits are particularly relevant when the claimant's spouse earned substantially more income over their career, resulting in larger Social Security payments.
Spousal benefits are generally accessible to those currently married or to individuals divorced after at least ten years of marriage. It is important to note that spousal benefits require that the spouse has already filed for their own retirement benefits.
Survivor benefits become available if the claimant's spouse has passed away. These benefits can sometimes surpass the original claimant's own retirement benefit amount. While not universally higher, for many recipients, selecting the higher spousal or survivor benefit can significantly bolster monthly income.
Conclusion
Social Security remains a critical source of income for most retirees, with early claiming markedly reducing monthly payments. However, the four strategies outlined offer meaningful ways to enhance benefits after early claiming: rescinding recent claims, leveraging work income to offset penalties, increasing earnings to adjust benefit calculations, and opting for spousal or survivor benefits when applicable. Evaluating eligibility and taking advantage of these methods can improve retirement income security and provide greater peace of mind in later years.