Social Security benefit amount dropping after early retirement - will it keep decreasing?

Yes, you're correct. The SSA calculation is based on your highest 35 years of earnings. When you stop working, the calculator adjusts its projections because it's no longer assuming you'll continue to earn at the same level. Each year you don't work before claiming means another year of zeros (or lower earnings) factored into your average, which slightly reduces your PIA (Primary Insurance Amount). It will continue to adjust until you actually file for benefits. The good news is that waiting until your FRA will maximize what you get based on your work history!

same thing happend to me when I stoped working at 59!! the number kept going down every year. not by much but still annoying to see it drop. my neighbor told me that SS uses your top 35 years so when you stop working early they have to add more years with $0 to your calculation

I just went through this exact situation! It's completely normal and YOU ARE NOT MISSING ANYTHING. The original estimate assumed you'd keep working at your last income level until your Full Retirement Age. Now that you've stopped working, the system is recalculating based on zeros for those years. Here's what I learned: The SSA takes your highest 35 years of earnings (adjusted for inflation) to calculate your benefit. If you don't have 35 years of earnings, they use zeros for the missing years. Each year you don't work before claiming means another zero in the calculation, which slightly lowers your benefit amount. The good news is the drop is usually small if you already have most of your 35 years filled with good earnings. And by waiting until your FRA to claim, you'll get 100% of whatever your final calculation is (and even more if you wait beyond FRA).

I had this exact problem trying to understand my SS benefit projections! I kept seeing the amount drop and couldn't reach anyone at SSA to explain it. After DOZENS of calls and getting disconnected, I finally used Claimyr.com to get through to an actual SSA agent who explained everything. They have a video demo at https://youtu.be/Z-BRbJw3puU that shows how it works. The agent confirmed exactly what others are saying - it's calculating your benefit based on your top 35 earning years, and each year without income slightly changes the projection. Totally normal but frustrating to watch it drop!

Are you sure its going down??? Mine shows different amounts depending WHERE I look on the site!! The homepage shows one number but the detailed calculator shows something different. Maybe check both places before worrying. Good luck!!

This happened to me too! Every year I check and it drops a little. Just part of retiring early. I wouldn't worry unless it's dropping by huge amounts.

You've got it exactly right. The SSA benefit calculator initially assumes you'll continue earning at roughly the same level until you reach retirement age. When you retire early and input zeros for future years, you're providing more accurate information, which results in a recalculation. Here's what's happening technically: Your Social Security benefit is based on your highest 35 years of indexed earnings. The indexing adjusts your historical earnings to account for changes in wage levels over time. If you don't have 35 years of earnings, SSA fills in the missing years with zeros. Since you stopped working at 58, any remaining years needed to reach 35 that would have been projected with your current salary are now being filled with zeros instead. This gradually lowers your Average Indexed Monthly Earnings (AIME), which then lowers your Primary Insurance Amount (PIA). The good news: If you already have close to 35 years of solid earnings, the impact of these zeros will be minimal. Also, waiting until your Full Retirement Age as you plan to do will ensure you receive 100% of your PIA regardless of these small adjustments.

WAIT do you have enough credits??? you said 45 but dont you need more? I thought it was 40 quarters which is 10 years

One more thing to consider: While your benefit amount is dropping slightly now, remember that every year it will be adjusted for COLA (Cost-of-Living Adjustments). So when you actually start receiving benefits at your FRA, it will likely be more than what you're seeing projected now, just due to inflation adjustments.

I'm going through the exact same thing! I retired early at 55 and have been watching my projected benefit slowly tick down each year. It's definitely nerve-wracking at first, but everyone here is spot on - it's completely normal. The SSA system was originally projecting based on continued earnings, and now it's adjusting to reality. What helped me was understanding that the decline will eventually level off. Once you've been out of work for enough years that all your "top 35" earning years are locked in from your actual work history (not projections), the amount should stabilize. For me, that happened after about 4-5 years of retirement. Also, if you're like me and had some lower-earning years early in your career, those might actually get pushed out by your higher-earning years, which could slow or even reverse the decline slightly. The indexing for inflation on your historical earnings can sometimes work in your favor too. Hang in there - waiting until FRA is definitely the right move to maximize your benefit regardless of these small adjustments!

This is such a common concern for early retirees! I went through the exact same anxiety when I stopped working at 62. The dropping numbers feel alarming at first, but it's just the system becoming more accurate about your actual situation rather than projecting hypothetical future earnings. One thing that helped me understand it better was realizing that the SSA calculator is essentially doing you a favor by showing you realistic projections. Before you retired, it was making optimistic assumptions about continued income. Now it's giving you the real deal based on your actual work history. The $10/month drop you've seen so far is pretty typical. In my experience, the annual decreases get smaller over time, especially if you have a solid work history like you do with 32+ years. And remember, by waiting until your FRA, you're making a smart financial decision that will maximize whatever your final benefit calculation turns out to be. Don't let the declining projections stress you out too much - you're on the right track!

I'm dealing with this exact same situation right now! Took early retirement at 59 and have been watching my projected benefits slowly decline over the past year. At first I thought there was an error in the system, but after reading everyone's explanations here, it makes complete sense. The part that really clicked for me is understanding that the original estimates were basically "best case scenario" projections assuming I'd keep working at my peak salary until FRA. Now that I've stopped contributing, the reality is setting in and the numbers are adjusting accordingly. What I found helpful was running the detailed calculator with different scenarios - inputting zeros for all my remaining years until FRA versus putting in some part-time earnings. It really shows how each year of zero income affects the calculation. Since I'm planning to do some consulting work occasionally, it's reassuring to know that even modest earnings can help offset some of the decline. Thanks to everyone who shared their experiences - it's so much less stressful when you understand this is completely normal!