Ask Larry

Is It True That Delayed Retirement Credits Are Awarded Monthly Instead Of Annually?

Dear Larry,

Is the 8% annual increase in SS benefit for delaying calculated (awarded) monthly or annually? I turn 68 in January, and have been delaying my SS benefit to capitalize on the 8% annual growth promised (not counting COLA's). I have always understood this to be calculated on a monthly basis, so disregarding any COLA effect, I expect that if I started collecting at exactly age 68, my benefit would be 16% lower than at age 70, and if I started at age 68 and 6 months, that it would be 12% less. IE: every month I delay should raise my benefit another 0.6667%, as opposed to having to wait another entire year to see the gain. Is this true?

Mike B

Hi Mike. It's true that for every month you delay receiving your Social Security retirement benefits between full retirement age (FRA) and age 70, your permanent benefit rate would increase by 2/3rds of 1%. However, if you claim benefits any time after FRA and before age 70, your benefit rate is initially credited only with the delayed retirement credits (DRC) you earned through December of the year prior to the year you claim benefits.

Therefore, if you claim benefits effective with any month other than January or the month you turn age 70, you won't immediately receive credit for all of your DRCs. If you claim benefits in the middle of a year, the DRCs earned in that year aren't credited until effective with your benefit payment for January of the following year. So, in your case, if you filed effective with July 2023 at age 68 & 6 months, your benefit rate would initially be 16% lower than your age 70 rate. But, effective with your benefit payment for January 2024, you'd be due a 4% benefit rate increase to bring your rate up to 12% below your age 70 rate.

You may want to strongly consider using our software ( to fully compare and analyze all of your various options so that you can determine your best strategy for maximizing your benefits.

Best, Jerry

Oct 16 2022 - 12:55pm
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