I am 69 yrs old. I took SS at age 65 in 2018. I have 50+ years of earnings. I went back to work in 2022 and made $17K+ of earnings from a part-time job. Will this amount replace a lower earnings year of the 35 SS used to calculate my benefit? And if so, will my benefit be re-calculated automatically and be increased? When??
Thank you,
Denise
Hi Denise. Social Security retirement benefits are based on an average of a person's highest 35 years of Social Security covered wage-indexed earnings (https://www.ssa.gov/oact/progdata/retirebenefit1.html). Therefore, your 2022 earnings will only increase your benefit rate if those earnings were higher than one of the 35 WAGE-INDEXED earnings years on which your current benefit rate is based.
If your 2022 earnings were in fact higher than one of your previous highest 35 years of wage-indexed earnings then Social Security should automatically recalculate your benefit rate. Benefit increases resulting from 2022 earnings are effective with a person's benefit rate for the month of January 2023, but the automated recomputations generally aren't processed until around September of the year that the increase is due. But, when Social Security processes the recomputions they pay any back pay that's due.
Best, Jerry