We all know many Americans are working harder and longer today than ever before. Some of us do so because we must, others well, because what else would we do? Regardless of one’s motive for deciding to keep working, the fact remains that by delaying retirement you may be eligible for a correlated bonus.

Government reforms decades ago altered the typical retirement age from 65 to 67 years. Due to this phased in change, those individuals born between 1943 and 1954 for example, are eligible to receive full benefits at 66. Those who retire early have their benefits reduced. Similarly, those who defer retirement may have their benefits increased. Keep in mind, the government calculates these figures based upon when Social Security Benefits are claimed, not based upon the date your employment ends.

By delaying retirement past 66, those born between 1943 and 1954 (the “sweet spot”) will have their monthly benefit increased by 8% for each year they do so, up to 4 additional years. Therefore, the bonus is capped at age 70, with the maximum possible increase being 32%.

To see the Social Security Administration’s Chart of the Effect of Early or Delayed Retirement on Retirement Benefits, click here:

http://www.ssa.gov/OACT/ProgData/ar_drc.html

[Disclaimer: The materials contained on this website have been authored or gathered by the Law Offices of Stuart D. Zimring, and are intended for informational purposes only. It is not intended to be and is not considered to be legal advice. Transmission is not intended to create and receipt does not establish an attorney-client relationship.]