Ask Larry

Does The 8% Annual Increase From Delayed Retirement Credits Only Apply If I Continue Working?

Hi Larry:
On October 2022, I reached my FRA, and retired this past January 2023, I am no longer working and earning a salary.
Does the annual 8% increase on the earn delayed retirement credits, only apply if I continue working and earning a salary until I reach age 70, or is it, if I simply wait to apply for ss benefits until it I reach age of 70?
last month while talking to a ss agent to apply for Medicare, I was asked if I wanted to apply for my ss benefits, since i was not provided with information on delaying retirement credits, I said yes. Now, if I simply have to wait to age 70 for a better pay out, but I already received a retroactive lump sum (last month) , should I do a suspense of benefits or a withdrawal of benefits?

It would be greatly appreciated if you can kindly reply via my e-mail address, I am also assuming that you are posting my question online, or in your newsletter, kindly make sure my e-mail address is not visible.

Thank you so much for having this forum, and for sharing your knowledge.

Hi Maria. No, you don't have to be working in order to earn delayed retirement credits (DRC). DRCs are added to your benefit rate for each month that you don't collect Social Security retirement benefits between your full retirement age (FRA) and age 70, regardless of your work status. The DRC credit amounts to 2/3rds of 1% per month, or 8% per year.

You can't suspend your benefits retroactively in order to earn DRCs. The earliest that you could suspend benefits is the month after the month you submit your request for suspension to Social Security. So, if you submitted a request to suspend your benefits to Social Security in March 2023, for example, April 2023 is the first month that you could start earning DRCs.

Alternatively, you could withdraw your application ( and repay all of the benefits you've been paid. You could then reapply for benefits when you reach age 70, in which case you'd be credited with your maximum amount of DRCs. You may want to consider using our software ( to fully compare and analyze all of your options so that you can determine your best strategy for maximizing your benefits.

Best, Jerry

Mar 6 2023 - 6:39pm
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