The 12-Month Social Security Do-Over Most Retirees Don't Know About: It Could Pay You Over $1,100 More for Life

"If you file for Social Security at full retirement age (FRA), which is 67 if you were born in or after 1960, you'll get your exact monthly benefit amount based on your wage history. But you can also file for Social Security earlier or later. Age 62 is the soonest you can claim Social Security. On the flipside, you can grow your Social Security benefits by 8% for each year you wait beyond FRA, up until you turn 70."

"You'll often hear that if you claim Social Security ahead of FRA, you'll be stuck with a smaller monthly benefit for life. But that's not automatically true. Social Security has a do-over option a lot of retirees don't know about. If you claim Social Security and regret your decision after the fact, you can withdraw your application for benefits, repay all of the money you received, and file again at a later point in time. And in some cases, the payoff for doing so could be huge."

"The average monthly Social Security benefit for retirees today is $2,079. If that's the benefit you're eligible for at FRA but you file at age 62 instead, you'll shrink your monthly payments to $1,455. On the other hand, if you file for Social Security at 70, your monthly benefit increases to $2,578. So if you claim Social Security at 62 and regret that decision immediately, it pays to undo your filing."

"If you then sit tight and don't file until age 70, you could wind up with an additional $1,123 a month in Social Security for the rest of your life. That means the do-over option can turn a reduced early claim into a higher delayed claim, as long as the withdrawal and repayment steps are handled correctly."

Monthly Social Security benefits depend on earnings history and filing age. Full retirement age is 67 for people born in or after 1960, and claiming at that age pays the exact benefit based on wage history. Benefits can be claimed as early as age 62, which typically reduces monthly payments for life. Benefits can also be increased by waiting beyond full retirement age, growing by 8% each year up to age 70. A do-over option allows withdrawing an application after claiming, repaying benefits received, and filing again later. This can substantially increase lifetime monthly income in cases where early claiming is reversed.

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