Larry: I will turn 69 on 8/10/17. I plan to file for my Social Security using August 1, 2017 as my starting month & I will not receive my first check until Sept. 2017. Since my birthday is 8/10/17 which is "after" 8/01/17, will I still receive a full 36 months of DRC's? Also, based on the information from your website, when I file to start 8/01/17, I calculate that I will receive 28 of the 36 DRC's with the remaining 8 DRC's to be paid to me in Jan. 2018. Am I correct in calculating the number of DRC's that I will be eligible for as well as the time frame that the DRC's will be paid? Will the 8 DRC's that I will be eligible for but will not receive in 2017, will all 8 DRC's be paid to me in a Lump Sum in Jan. 2018 or will thay be spread out in 8 monthly payments in 2018? You have stated in some of your previous responses to this question that the system automastically calculates these credits and pays them every other year. In my case will the 8 DRC's that I will be owed be issued to me in Jan. 2018 or Jan. 2019 & will the disbursement of unpaid DRC's be dispersed in a Lump Sum or in 8 Equal Payments? Also, does the Social Security System calculate & pay these credits on an even or odd year basis or on a random basis as their time permits?

Thank you!

Hi,

It sounds like you have a fairly good understanding of the process. Actually, though, if you start drawing effective with August 2017 you will initially be credited with 29 delayed retirement credits (DRC). Specifically, the credits will cover the months August 2014 (i.e. month of full retirement age attainment) through December 2016. Then, effective with your check for January 2018, you will be credited with the full 36 months of DRCs. The actual recomputation to include the additional 7 months of DRCs may not be done until as late as sometime in 2019, though. I have no way of knowing Social Security's specific schedule for recomputing benefits to include additional DRCs, but I understand that the automated process is done every other year.

I'll give you an example in order to clarify how the computation works. Say that your full retirement age rate (PIA) is $2000, and you file at age 69 in August 2017. Your initial monthly benefit rate starting August 2017 would be about $2386. That includes 29 DRCs calculated at a rate of 2/3rds of 1% per month. Then, effective January 2018 you would be due a recomputation to include the 7 DRCs for January through July 2017, increasing your monthly rate to approximately $2480. Social Security would eventually make a lump sum payment to pay you the extra $94 for any months that elapse between January 2018 and whenever they actually process the recomputation.

Before filing, though, you may want to consider running the maximization software available on this website in order to determine the long term effects of filing at age 69 as opposed to age 70.

Best, Jerry