What Happens If I Delay Social Security?

Understanding Delayed Retirement Credits and How Much Your Benefits Grow

For many people approaching retirement, deciding when to claim Social Security is one of the biggest financial choices they’ll make. Although you can claim benefits as early as age 62, the timing of your claim can dramatically affect how much you receive each month for the rest of your life. One of the most powerful levers you control is the delayed retirement credit, a built-in bonus for waiting to take benefits after your full retirement age (FRA).

If you’re wondering whether delaying Social Security is worth it, this article breaks down exactly how delayed retirement credits work, how much your monthly benefits can grow, and the key tradeoffs to consider.

Full Retirement Age: The Starting Point

Before diving into delayed credits, you need to know your full retirement age (FRA). This is the age at which you qualify for 100% of your earned Social Security benefit. It’s based on your birth year:

• Born 1943–1954: FRA is 66

• Born 1955–1959: FRA gradually increases up to 66 and 10 months

• Born 1960 or later: FRA is 67

Claiming before your FRA permanently reduces your monthly benefit. Claiming after your FRA increases it.

What Are Delayed Retirement Credits?

If you wait beyond your FRA to claim Social Security, you earn Delayed Retirement Credits (DRCs). These credits increase your benefit by 8% for every 12 months you delay, up to age 70.

You can think of this as an annual, guaranteed raise from the government for waiting.

Here’s the growth rate:

• FRA to 70 → 8% increase per year

• Maximum delay period → 3 to 4 years, depending on your FRA

• Maximum total increase → About 24% to 32%

This increase is added to any annual cost-of-living adjustments (COLAs), which means the boost compounds over time.

How Delayed Retirement Credits Increase Your Benefit

Let’s walk through a simple example.

Say your full retirement age benefit (known as your Primary Insurance Amount, or PIA) is $2,000 per month at age 67.

If you delay:

• Claim at 68: 8% increase → $2,160

• Claim at 69: 16% increase → $2,320

• Claim at 70: 24% increase → $2,480

From that point on, the larger number becomes your base benefit for life—plus annual COLAs.

Why Does Social Security Offer These Credits?

Social Security is designed to be actuarially neutral. That means the system is built so that on average, people receive roughly the same lifetime benefit regardless of when they claim—assuming they live around average life expectancy.

The tradeoff:

• Claim early → lower monthly benefits but paid for more years

• Claim late → higher monthly benefits but paid for fewer years

Since Social Security doesn’t know how long any specific person will live, the system uses these delayed credits to stay balanced across the population.

When Delaying Social Security Makes Sense

Delaying benefits can be very financially rewarding, but it isn’t the right choice for everyone. Here are the situations where it makes the most sense.

1. You Expect to Live at Least to Your Late 70s or Beyond

The longer you live, the more the delayed credits pay off. For many people, the “break-even age”—the age where total lifetime benefits are equal between claiming earlier or later—is typically around age 78–81.

If you have:

• Good health

• Longevity in your family

• Or a desire to protect against outliving your money

…delaying can be a strong choice.

2. You Have Other Income to Live On

You might delay benefits if you:

• Are still working

• Have savings you prefer to use before Social Security

• Receive income from a pension or rental property

Delaying lets your Social Security grow while you cover expenses another way.

3. You Want to Protect a Surviving Spouse

If your spouse will qualify for a survivor benefit, delaying can be a powerful tool. When one spouse dies, the surviving spouse receives the larger of the two benefits.

That means your decision to delay can boost not just your income—but potentially your spouse’s income for life.

When Delaying May Not Be the Best Choice

1. You Have Health Concerns

If your life expectancy is shorter than average, taking benefits earlier often pays off.

2. You Need the Income Now

Not everyone has the flexibility to delay. If your budget requires Social Security sooner, claiming earlier can make sense.

3. You’re Claiming on a Spouse’s Record

Delayed retirement credits do not increase spousal benefits. So if you’re only eligible for a spousal benefit, delaying your own filing doesn’t help you.

How Delayed Retirement Credits Work Every Month

While Social Security advertises that benefits grow 8% per year, technically the growth is earned monthly.

If your FRA is 67:

• For each month you delay, you earn two-thirds of 1% (0.667%).

• Over 12 months, that adds up to 8%.

So if you delay just part of a year—say, 8 months—your benefit still increases proportionally.

Delaying Benefits and Working After FRA

If you claim benefits before your FRA and continue working, your benefits may be temporarily reduced due to the earnings test.

But after you reach FRA:

• You can work and earn as much as you want, with no reduction.

• You can still delay your benefits to keep accumulating DRCs.

This gives many people the chance to:

• Work a few extra years

• Delay filing

• Increase monthly benefits significantly

Delayed Retirement Credits vs. Cost-of-Living Adjustments (COLAs)

These two increases work differently:

• DRCs boost your benefit by 8% per year you delay.

• COLAs adjust benefits annually based on inflation.

If you delay, you receive both:

• Your future payouts are larger due to DRCs.

• Every future COLA applies to the enlarged benefit amount.

So delaying gives you a bigger base for future inflation adjustments.

What Happens at Age 70?

Age 70 is the ceiling. You cannot earn DRCs beyond this point.

Even if you don’t need the money at 70, you should file, because waiting longer provides no additional benefit. If you accidentally delay past 70, Social Security can pay up to six months of retroactive benefits—but not more.

Common Misconceptions About Delaying

“If I delay, I might get nothing if I die early.”

True—but everyone faces this risk. Social Security is structured around population averages. The key question is whether the guaranteed 8% annual increase is worth the wait based on your personal situation.

“If I delay, my spouse’s benefits grow too.”

Only survivor benefits grow with your delayed credits. Spousal benefits do not.

“I’ll lose money if I keep working while delaying.”

No—you can earn as much as you want after FRA. Your future Social Security benefit may even increase if your new earnings replace low-earning years in your work history.

Strategic Reasons People Delay Benefits

1. Creating a Lifetime “Income Floor”

Social Security is inflation-protected and lasts for life. A higher guaranteed monthly check helps reduce financial uncertainty later in life.

2. Reducing Pressure on Savings

Delaying Social Security often means tapping savings earlier. But the payoff is a higher guaranteed income for the decades that follow.

3. Tax Planning

Some retirees delay Social Security to intentionally draw down tax-deferred accounts (like traditional IRAs) first. This can reduce future Required Minimum Distributions (RMDs) and lower long-term tax burdens.

Case Study: Comparing Early, On-Time, and Delayed Benefits

Let’s compare age 62, FRA (67), and age 70 benefits based on a $2,000 PIA.

• Age 62: about 30% reduction → around $1,400

• Age 67: full benefit → $2,000

• Age 70: about 24% increase → $2,480

Monthly difference:

• Between 62 and 70 → $1,080 more per month

• Over 20 years → more than $250,000 in additional payments

Of course, claiming earlier might still be right if your circumstances demand it, but the financial advantage of delaying is substantial over a long life.

Combining Delaying With Partial Claiming

Some people use a hybrid strategy:

• The lower-earning spouse claims at FRA or sooner.

• The higher-earning spouse delays to maximize the survivor benefit.

This balances immediate cash flow with long-term protection for both spouses.

Key Questions to Consider Before Deciding

1. Do I expect to live at least into my late 70s or early 80s?

2. Do I have income or savings to cover living expenses while I wait?

3. Is maximizing survivor benefits important?

4. Am I still working, and how does that affect my taxes?

5. Do I want a larger guaranteed income for later in life?

If the answers lean positive, delaying can be a very strong financial move.

Bottom Line

Delaying Social Security past your full retirement age can significantly increase your monthly benefit through delayed retirement credits—roughly 8% per year up to age 70. This can provide a higher, inflation-adjusted income for the rest of your life and offer added protection for a surviving spouse.

But the right decision depends on your health, finances, and personal goals. Delaying is most beneficial when you have the flexibility to wait and expect to live long enough for the increased benefits to pay off.