Should I claim widow benefits at 64 if SS checks would be withheld due to earnings limit?

Your sister has a good earning situation, but here's what happens with the earnings test: When benefits are withheld due to excess earnings, SSA recalculates her benefit at her Full Retirement Age (67) to credit back those months of withholding. Basically, if she files for survivor benefits at 64 and loses some/all to the earnings limit, SSA will adjust her benefit amount at FRA as if she had filed later for those months that were fully withheld. However, this doesn't necessarily mean she'll get MORE money overall.This is a complex decision that depends on several factors:1. The amount of her survivor benefit vs. her own retirement benefit2. Whether she plans to switch between benefit types at some point3. How much will actually be withheld due to earningsThe 2023 earnings limit for someone under FRA is $21,240, so she's well over that. She'll lose $1 in benefits for every $2 above the limit.

Thank you for that explanation! So if I understand correctly, she won't actually come out ahead by claiming early just to have benefits withheld? If that's true, it seems like she might as well just wait until her earnings drop below the limit when she retires at 65.One more question: does it matter whether she claims survivor benefits or her own retirement benefits first? Is one strategy better than the other?

My huband died 3 years ago and I went thru this EXACT thing!! I was 63 making good money but filed anyway. Most of my checks got withheld but SSA told me later that I'd get credit for those months. But honestly I wish I'd just waited til I retired!! The paperwork was a PAIN and I kept getting confusing letters about withheld amounts. Just tell your sister to wait till she retires and save herself the headache!!!

That's really helpful to hear about your experience! I was worried about all the paperwork and confusion too. Did you ever actually see the benefit of those

This is actually a great strategic question about Social Security. The key thing to understand is that your sister has two separate benefits to consider - survivor benefits from her late husband and her own retirement benefit based on her work record.In most cases, the optimal strategy for widows/widowers is to take the smaller benefit first and switch to the larger one later. If her survivor benefit is smaller than her own retirement benefit will be at 70, she might want to take survivor now (even with withholding) and switch to her own at 70. If her survivor benefit is larger, she might take her own reduced retirement at 62-67 and then switch to survivor at her FRA.Regarding the credits from withholding: Yes, SSA will adjust her benefit later, but this mainly removes the early filing reduction for those months - it doesn't create extra money beyond what she'd get by just filing later. The main advantage would be if she's executing a strategy where she needs to file for one benefit type now to be able to switch to a higher one later.

Wow, I didn't realize there were these strategies involving switching between benefits! That's fascinating. I think her survivor benefit would be higher than her own retirement benefit. So in that case, would she be better off claiming her own retirement benefit now (even though it would be mostly withheld), and then switching to the survivor benefit at her FRA?

Just FYI my mom went through this exact thing and the SSA withheld her benefits and then they made a huge mistake and never gave her the credits back!!! It was a NIGHTMARE trying to get it fixed. She spent like 6 months calling and going to the office and they still haven't fixed it right. Just saying be careful with this!!! The SSA makes errors all the time!!

Oh no, that sounds awful! Did your mom ever get it resolved? This makes me nervous about recommending any strategy that's too complicated for my sister.

So I have been dealing with Social Security for the past 3 years and let me tell you, trying to reach them is IMPOSSIBLE most of the time!!! I spent HOURS on hold just trying to ask a similar question about my benefits. Finally I found this service called Claimyr (claimyr.com) that got me through to a real person at SSA in under 20 minutes! They have a video showing how it works at https://youtu.be/Z-BRbJw3puUIf your sister decides to file for benefits while still working, she'll definitely need to talk to SSA directly about how the earnings test and credit recalculation will affect her specific situation. The online calculators don't handle these complex scenarios well.

Does this Claimyr thing actually work? I've been trying to reach SS for weeks about my disability review.

It worked great for me. I was skeptical too but after waiting on hold for literally 3+ hours over multiple days, I was desperate. Got through in about 15 minutes and finally got my questions answered. The agent I spoke with at SSA was really helpful once I actually reached them.

ur overcomplicating this. just tell her to wait till shes done working! why go thru all the trouble for nothing?? the benefit recalculation thing sounds nice but then you gotta deal with SSA every year reporting earnings and getting letters and possibly audits. not worth the hassel imo

That's a fair point about the hassle factor. I'm going to factor that into my recommendation for her. Thanks!

To answer your follow-up question - yes, which benefit she claims first DOES matter significantly. Since she's a widow, she has the unique ability to file for one type of benefit first and then switch to the other later.Based on what you've shared, if her survivor benefit will be higher than her own retirement benefit, the optimal strategy might be:1. File for her own reduced retirement benefit at 65 when she stops working2. Switch to survivor benefits at her FRA (67) to get 100% of her late husband's benefitIf her own retirement benefit will be higher (especially if she waits until 70):1. File for survivor benefits at 65 when she stops working2. Switch to her own retirement benefit at 70 when it reaches maximum valueThis flexibility to switch between benefit types is a special provision for survivors that can significantly increase lifetime benefits. But it requires careful planning based on the exact benefit amounts.

This is incredibly helpful! I'm going to suggest she contact SSA to get exact benefit estimates for both her survivor benefit and her own retirement benefit at different ages. That should help us figure out which claiming strategy makes the most sense. Really appreciate this detailed explanation.

I forgot 2 mention that if your sister already submitted her Rrequiest for benefits & wants to change her mind, she only has 12 MONTHS to withdraw the application and it REQUIRES PAYING BACK any benefits she recieved!!! Important to know this before she does anything!!!

Good point about the 12-month withdrawal window. However, in this specific scenario with earnings limit withholding, she might not receive any benefits to pay back if her earnings are high enough to cause 100% withholding. But you're absolutely right that understanding the withdrawal rules is critical before making any filing decision.