Is It Still Possible To Suspend and Restart Benefits?

Jul 30 2016 - 12:15pm

I read Mr. Kotlikoff's Forbes.com article "The Huge Payoff from Claiming Social Security Wisely" dated July 29, 2016. Case No. 2 closely resembles the situation for my husband and me. The article states that Liz, the lower earning spouse who claims at 62, could suspend her benefits at 66 and restart at a 32% higher rate at age 70. My understanding is that under the new Social Security rules, it is no longer possible to suspend and restart benefits. Am I wrong?

Hi,

Yes, benefits can still be voluntarily suspended between full retirement age and age 70. What changed is that for voluntary suspensions requested after April 29 2016, no benefits can be paid to other beneficiaries eligible on the suspended account, nor can the person who requests voluntary suspension receive benefits on any other account while their own benefits are suspended. The new law also eliminated the option to receive a lump sum payment for the months of suspension for people filing voluntary suspension requests after the deadline. For more details on the new law, see the following instructions issued to SSA employees regarding the new rules: https://secure.ssa.gov/apps10/reference.nsf/links/02182016020549PM.

So, in some cases it may be advantageous for a person to apply for reduced benefits in order to entitle other family members to auxiliary benefits on their account. Whether or not it would be advantageous for them to subsequently suspend benefits at full retirement age depends on the circumstances involved.

Best, Jerry