In the United States, Social Security is a fundamental program that provides income during retirement. However, not everyone is aware that it’s possible to temporarily suspend these benefits. This decision can be advantageous if you aim to increase your monthly payments later on.
For example, while you can start receiving benefits as early as age 62, the payments will be smaller compared to what you’d receive if you waited until your full retirement age, typically 67. By delaying further until age 70, your monthly benefits will reach their maximum. Of course, waiting that long can be challenging, but suspending benefits is an option worth considering if your financial situation changes.
What does it mean to suspend your Social Security benefits?
This option may be particularly appealing if you start receiving Social Security and later find yourself with an alternative source of income—perhaps through a new job, an inheritance, or other unexpected financial support. By pausing your benefits, you can boost the amount you’ll receive when you resume payments.
Not everyone receiving Social Security can opt to suspend their benefits. To be eligible, you must have reached your full retirement age, which, for most people, is currently 67. If you began receiving benefits before this age, you’ll need to wait until you reach it before requesting a suspension.
However, there’s an exception for those who have been receiving benefits for less than a year. If this applies to you, you can withdraw your initial application for benefits, effectively halting payments. The catch? You’ll need to repay any benefits you’ve received up to that point.
How to suspend your Social Security benefits
The process to suspend Social Security benefits is straightforward and doesn’t involve excessive paperwork. There are three main ways to make this request:
- By phone: Contact the Social Security Administration directly.
- In person: Visit your local Social Security office.
- In writing: Send a formal request to the administration.
Once your request is approved, the suspension will take effect the month after the request is processed, provided you are not currently awaiting approval for a new benefit claim. The benefits will remain suspended until you either request to resume them or the month before you turn 70, whichever comes first.
In some cases, you can submit a request to suspend benefits ahead of time. However, the suspension cannot start before:
- The month following your request.
- The date you reach full retirement age.
- The first month you’re eligible for benefits if it’s your initial application.
Potential drawbacks of suspending benefits
While suspending your Social Security benefits can be an effective strategy to maximize future payments, it’s not without its downsides. Depending on your circumstances, you may face some significant disadvantages:
- If your spouse or children receive benefits based on your work record, their payments will also stop when you suspend your own. The exception is for an ex-spouse receiving benefits based on your record; those payments will continue unaffected.
- If you’re receiving benefits based on someone else’s record, those payments will also be suspended.
- If you’re enrolled in assistance programs like Supplemental Security Income (SSI), suspending your benefits could impact your eligibility for those programs until your Social Security payments resume.
Impact on Medicare Part B
Another critical factor to consider is how suspending your Social Security benefits affects your healthcare coverage. If you’re enrolled in Medicare Part B, which helps cover outpatient medical expenses, the premiums are typically deducted directly from your Social Security payments.
Once those payments are suspended, you’ll receive direct bills from the Centers for Medicare & Medicaid Services to cover your premiums. This change requires careful budgeting to ensure you don’t miss payments and risk losing coverage.
Is suspending your benefits the right choice for you?
Deciding whether to suspend your Social Security benefits depends on your unique financial situation. If you have alternative income sources or don’t currently need the payments, suspending benefits can be a powerful way to increase your long-term income. However, it’s essential to weigh the potential downsides, particularly if others rely on benefits tied to your account.
Before making any decisions, it’s wise to consult a financial advisor or visit a Social Security office to fully understand the implications of this choice. With thoughtful planning, you can take steps today that will positively impact your financial stability in the years to come.