My mother is 62 years old and is considering whether to start my deceased father's Social Security (Mother FRA $25,008 and Father FRA $28,800 per year.) She would get about $23,256 from my father at age 62 and her benefit at age 70 would be about $36,059. If she is still earning income of approximately $55,000 that would reduce the benefit she receives from my father's Social Security to about $6,000 per year. Does this reduced income from my father's benefit accumulate and given to her back at age 66 or is it lost? Even if the reduced benefits are lost, it seems like it will still benefit her to start as if she waits until next year or later the amount she would receive next year would only increase by about $1,600 per year and she is better off by about $10,000 by taking it now versus waiting to age 66 as she knows she will taking her own at age 70. Does that seem correct?

Hi,

No, benefits withheld due to the earnings test are not accumulated and given back at person's full retirement age (FRA). What does happen is that the recipient's benefit rate is recalculated at FRA in order to remove the percentage reduction for age that was applied to their benefit rate for any months that they aren't paid due to their earnings.

For example, say Jane files for widow's benefits at age 62 instead of her FRA of 66. Jane's FRA rate would be $1000, but she takes a reduced rate of $810 to start her benefits 48 months early. If Jane ends up only being paid for 24 of those months due to the earnings test, her widow's rate would be adjusted at FRA to remove half of the percentage reduction that was initially applied to her benefit rate. In Jane's case, that would increase her rate to $905.

You're correct, though, that if your mother's earnings will be low enough to permit even a small amount of benefits to be paid it would likely be best for her to start drawing one of her benefits early. She should strongly consider using our software (https://maximizemysocialsecurity.com/purchase) to explore and compare all of her options in order to identify her best possible filing strategy.

Best, Jerry