I understand that SS calculates your benefit by the highest 35 earnings years but what if you retire in the middle of a year that will end up greater than one of those years. I am faced with two such scenarios. My FRA is October 1st but I plan on working until the end of May. If I wait to collect in May, then I'm sure they would use this last years as it will be my highest earning year ever and I will gain about an extra 4% per month, . But if I start collecting now, but continue working, and since this year will not be fully over, will the year be entirely omitted in the calculation?

Hi. The earliest that your 2021 earnings could be used in the calculation of your benefit rate would be January 2022. That's true regardless of when you start drawing your benefits. If you start drawing benefits this year, your benefit rate would initially be based on your highest 35 years of Social Security covered wage indexed earnings through 2020. However, your benefit rate could then be recalculated effective January 2022 to give you credit for your 2021 earnings.

So, let's say you start drawing your Social Security retirement benefits effective October 2021. Your first 3 months of benefits would then be based on your highest 35 earnings years through 2020 Then, if your 2021 earnings are higher than one of the previous 35 years on which your initial benefit rate was calculated, your benefit rate could be recalculated effective with your payment for January 2022 to replace your lowest prior computational year with your higher 2021 earnings.

You may want to strongly consider using our software (https://maximizemysocialsecurity.com/purchase) to fully analyze all of your options so that you can determine what you feel is your best strategy for maximizing your benefits.

Best, Jerry