I started drawing my Social Security benefit at 63-1/2. If I suspend at my FRA, is the 8% annual increase based on the amount I received to begin with, or at the amount I'm receiving at the time I file to suspend?

Thank you for your help!

Hi,

Just to clarify, you can't voluntarily suspend your benefits to earn delayed retirement credits (DRC) until effective with the month you reach full retirement age (FRA). And, you need to make your request to Social Security no later than the month prior to the month that you want your benefits to be suspended.

If you've been drawing reduced Social Security retirement benefits and you suspend your benefits between FRA and age 70, the DRCs will be calculated based on your reduced rate inclusive of any Social Security cost of living increases (COLA) or other benefit rate adjustments.

For example, say that Jack has a primary insurance amount (PIA) of $1,000 but files for his benefits at age 63 and receives a reduced rate of $800. If Jack voluntarily suspends his benefits at FRA or later and earns DRCs totaling 16%, that 16% increase would be applied to his reduced rate. If no COLAs or benefit rate increases are involved, Jack's benefit rate would increase to $928 (i.e. $800 x 1.16). But, if Jack's reduced benefit rate had risen to $850 due to COLAs then the 16% increase would boost his rate to $986 (i.e. $850 x 1.16).

Best, Jerry