“When it comes to Social Security benefits, there is such a thing as a do-over.”
Few things in life, past age 12, offer a “do-over” option. So you may be surprised to learn that Social Security does! According to The Wall Street Journal, the majority of Social Security beneficiaries claim early, reduced benefits. But a little-known part of the law allows retirees who started collecting benefits to change their minds, start over and reapply for a greater benefit.
The only hurdle? You must repay the benefits you have received, which can amount to a sizeable sum.
Resetting your Social Security benefits is a safeguard against outliving your savings, and can increase your retirement income substantially. In fact, in WSJ’s example of “Paying it Back,” the sample couple was able to increase their annual benefit amount by more than 70% using the reset strategy.
If you’re concerned about outliving your savings, you took reduced early benefits, and you have the cash to pay back the benefits you received, resetting your benefits might make sense for you.
Like any financial strategy, this is one that makes sense for some, and not for others. Consult with qualified counsel before making any decision regarding your Social Security benefits.