Dear Larry - I'm 67 (past FRA), am planning to work for 2 more years, and debating two strategies. (1) work for two more years and start collecting retirement benefits at that time. OR (2) start collecting benefits now (67) but keep working for two more years. I understand the government automatically checks if any of my post-retirement earnings years would be more than my 35 highest my 67 year old benefits were calculated at and if so, automatically increase my benefits to make up the difference. If two years of "make up the difference" increases would give me the same monthly payment by the time I'm 69 regardless which way I go, I'm having a hard time understanding why option (2) is not the "too good to be true" choice. Maybe the "fine print" of the recalculation increases somehow account for the money I already received but I don't see that caveat anywhere. Signed, Confused in Concord.

Hi. Your primary insurance amount (PIA) would end up being the same based on either of your 2 options, but your monthly benefit rate would be lower under option 2 because you don't earn delayed retirement credits (DRC) for any months that you're paid benefits. A person's PIA is equal to their Social Security retirement benefit rate if they start drawing their benefits at full retirement age (FRA). DRCs add 2/3rds of 1% to a person's benefit rate for each month that they don't collect Social Security retirement benefits between FRA and age 70.

For example, say Bob and Bill both have PIAs of $2000. Bob starts drawing benefits at FRA, but continues working. Bill also continues working but doesn't start collecting his benefits until 2 years after he reaches FRA. By the time Bill starts drawing his benefits, we'll say that both his and Bob's PIA's have risen to $2200 due to earnings recomputations and cost of living (COLA) increases. In that case, Bill's benefit rate would be $2552, inclusive of the 16% DRC increase he earned by waiting until 2 years after reaching FRA to start drawing his benefits (i.e. $2200 x 1.16). On the other hand, Bob's monthly benefit rate would be equal to his PIA of $2200 since he started collecting benefits at his FRA.

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 your best strategy for maximizing your benefits.

Best, Jerry