Applying for Social Security is a decision that requires careful thought. Your age at sign-up can permanently affect how much money you get from the program.
For most people, applying for benefits is a one-time process. But if you’ve signed up in the last 12 months and now regret your decision, you might be able to undo it. Below, we’ll look at how, and who might want to do this.
Why would you want to withdraw your Social Security application?
Withdrawing your Social Security application might be a smart move if you think you started benefits too early. The earlier you begin claiming, the smaller your monthly checks are. Or put another way, every month you delay benefits increases your checks slightly until you qualify for your maximum benefit at 70.
This doesn’t mean delaying benefits is always the right move. Claiming earlier makes sense for those with shorter life expectancies or those who cannot afford to cover their basic expenses without Social Security. But if neither of those situations apply to you, you might get more from the program over your lifetime by delaying.
If you have already signed up, withdrawing your Social Security application enables you to turn back the clock. The government will treat you as if you have never received any checks. Then, you can apply again later when you’re ready and reap the reward of a larger monthly benefit.
But you can do this only once, and there are a number of rules to follow.
How to withdraw your Social Security application
To start the process, you must submit a Request for Withdrawal of Application form to the Social Security Administration (SSA). This indicates that you would like it to stop sending you checks until you sign up again. That’s the easy part.
The trickier part is that you must also pay back any money you already received from the program. This includes benefits paid to you as well as to your spouse or dependents if they’re claiming on your work record. If you had Medicare premiums withheld from your checks, you’ll have to pay these back as well. For some, this isn’t feasible.
There’s also a time limit on when you can withdraw your application: You may only do so within the first 12 months after starting Social Security. If it’s been longer than that, it’s not an option, even if you can return the money already received.
What if you can’t withdraw your Social Security application?
If one of the constraints listed above prevents you from withdrawing your application, you may be able to suspend benefits once you reach your full retirement age (FRA). Your FRA falls somewhere between 66 and 67, depending on your birth year.
You can do this by contacting the SSA. Once you’ve requested the suspension, it will stop sending you benefits until you request it to begin again or you reach 70. During the time you’re not receiving checks, your benefit amount will grow by two-thirds of 1% per month. When you start receiving benefits again, your new checks will be larger, but they still won’t be as large as they would have been if you had never claimed Social Security before your FRA.
You don’t have to suspend benefits or withdraw your Social Security application if you’re comfortable with your decision to begin claiming benefits. But it’s good to know these options exist, especially if you have recently applied or plan to do so in the near future.