Ask Larry: Can My Earnings After 60 Increase My Social Security Benefit?

Today’s column addresses questions about how income after 60 can affect benefit amounts, how survivor’s benefit are calculated when the record holder dies before 70 and when delayed retirement credits are applied when filing at 70. Larry Kotlikoff is a Professor of Economics at Boston University and the founder and president of Economic Security Planning, Inc, which markets Maximize My Social Security and MaxiFi Planner.

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Have Social Security questions of your own you’d like answered? Ask Larry about Social Security here.

Can My Earnings After 60 Increase My Social Security Benefit?

Hi Larry, I would like to know if my earnings after 60 will go towards calculation of my Social Security benefit. I understand about the 35 highest earning years, but I am not sure if it is only for the 35 highest earning years up to the age of 60. I plan on working until 70. Thanks, Anthony

Hi Anthony, Yes, your earnings can be used to calculate your Social Security retirement benefit rate regardless of what age you are at the time you produce the earnings. The only difference is that earnings in years prior to the year a person reaches age 60 are indexed when determining the amount credited for benefit calculation purposes. Indexing basically converts a person’s earnings in years prior to age 60 to a more current day figure, and generally results in their being credited with an amount higher than their actual earnings for years prior to the year in which they reach 60.


For example, say that the national average wage index in the year that a person turns 60 is $51,000, and in the year they turned 30 it was $17,000. Indexing would then cause that person’s earnings in the year they turned 30 to be credited at three times their actual amount (i.e. $51,000 / $17,000 = 3.0). So for example, if that person earned $20,000 in the year they turned 30, they would be credited with earnings of $60,000 in that year when calculating their Social Security retirement benefit rate.

Earnings in years that a person turns age 60 and later can still be used to calculate their benefit rate, but only the actual amount of earnings is credited for those years. In other words, those earnings cannot be indexed to a higher amount. If they’re still high enough without indexing to replace earlier lower earning years in 35 years used to calculate benefit amounts, then they will increase your benefit amount. Best, Larry

If I Die Before Reaching Age 70 What Would My Wife’s Rate Be Based On?

Hi Larry, My wife and I are both 66. She is collecting her Social Security retirement benefit and I am waiting until 70. If I should not make it to 70, how would her widow’s benefit be calculated? What if I should pass after beginning to collect? Thanks, Jason

Hi Jason, Your wife’s survivor benefit rate would be equal to the higher of a) her own retirement benefit rate, or b) your full retirement benefit rate inclusive of any delayed retirement credits you earn by waiting past full retirement age (FRA) to start drawing your benefits. If you die after FRA and before you start drawing benefits, your wife’s widow’s rate would be calculated based on the benefit rate you would have been eligible for if you had started drawing your benefits in your month of death.

You and your wife may want to consider using my company’s software — Maximize My Social Security or MaxiFi Planner — to help you explore potential filing strategies and choose the one that works best for you. For example, if you were born prior to 1/2/1954, it sounds like you could potentially collect spousal benefits while letting your own retirement benefit rate to grow until 70. Social Security calculators provided by other companies or non-profits may provide proper suggestions if they were built with extreme care. Best, Larry

If I Start My Benefits The Month I Reach 70, Will My First Payment Include Current Year DRCs?

Hi Larry, If I turn 70 in December 2021and apply for benefits to start that month with my first check deposited January 2022, will I get credit for all my 2021 DRCs in that January 2022 check? Or will it be January 2023 before I see the bump for the 2021 DRC’s with an accompanying retroactive amount? Alternatively, if I wait just one month after I turn 70 to apply, thus giving up one month’s check, will the 2021 DRCs be applied right away for the rest of the eleven 2022 checks? Thanks, James

Hi James, Yes, all of your 2021 delayed retirement credits (DRCs) will be credited immediately if you claim your benefits in December 2021 and if you turn 70 that month. As long as a person doesn’t claim benefits in any months prior to the month they reach 70, they are credited will all of the DRCs they’ve earned for months prior to the month they reach 70 regardless of what month of the year their birthday occurs. Best, Larry

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