What Are the Consequences of Filing & Suspending Social Security Benefits?

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If you file and suspend Social Security retirement benefits, those benefits will grow to a larger monthly allotment later on, but you may have to change how you pay health insurance premiums. Some married couples can use a file-and-suspend strategy to allow one spouse to collect immediately and both to collect higher benefits later. Contact Social Security orally or in writing to suspend your retirement benefits.

Immediate Consequences

You can change your mind and suspend retirement benefits at any time up to age 70. Each month's payment arrives the following month, so if you ask for suspension in October, you'll receive your October benefit in November as the last payment before the suspension takes effect.

If Social Security has been paying Medicare Part B premiums out of your retirement benefit, you'll have to start paying them on your own -- for example, from a bank account. Failure to pay Medicare premiums could result in a loss of your coverage.

Withdrawing Your Claim

If you change your mind after you've been collecting benefits less than one year, you can withdraw your claim. To withdraw, file Form SSA-521 with the Social Security Administration.

If Social Security approves your request, you must pay back all the benefits paid to you and your family members based on your account. This includes money withheld for taxes, Medicare premiums and garnishments. Your repayment keeps your future benefits intact, as if you had never made an early claim.

How Much You'll Get

When you file and suspend, the longer you wait to restart benefits on your own account, the more you'll eventually receive each month. For example, if you file and suspend at age 62 before actually receiving any benefits, a monthly amount of $750 at age 62 grows to $800 at 63, $866 at 64, $933 at 65 and $1,000 at 66.

Those born between 1943 and 1954 have a full retirement age of 66. If you're in this age bracket, your benefits increase by 8 percent for each additional year you wait to restart them between 66 and 70.

When Benefits Restart

Social Security will restart your retirement benefits automatically at age 70 if you file and suspend. You can restart benefits sooner, however, by contacting Social Security. At that time, you can also request payment for some or all of the months of suspended benefits, although this reduces your future benefits.

Spousal Benefits Strategy

You can't apply for spousal benefits unless your husband or wife has filed for Social Security retirement. When working spouses reach full retirement age, the higher earner can file for retirement benefits and suspend immediately. This permits the lower earner to file a restricted application to collect spousal benefits only.

Both continue to accrue retirement credits up until age 70. Then the primary earner can claim a higher retirement benefit, and the recipient of spousal benefits can switch to her own higher amount.

If you file and suspend, your spouse can collect reduced spousal benefits as early as age 62, but she can't switch to her own benefit later. The amount of the reduction depends on how early she makes the claim. The full spousal benefit is 50 percent of the main benefit at full retirement age.