Social Security earnings update timing - delaying retirement past 65 to increase benefit amount

SSA automatically updates your earnings record when your employer reports your wages (typically quarterly) and when you file taxes. However, there's often a lag between when you earn income and when it shows up in SSA's systems. Your 2025 earnings typically won't be fully processed until mid-to-late 2026 after tax filing. That said, if you're past your FRA, you can apply for benefits and still have later earnings potentially increase your benefit through something called an Automatic Earnings Recomputation (ARF). SSA will automatically recalculate and adjust your benefit if new earnings are high enough to increase your benefit amount. If you're only working through April before retiring, weigh whether those few months of additional income will meaningfully impact your 35-year earnings history that SSA uses for benefit calculations.

I did this last year!! worked 3 months into the year then quit and filed. they didnt count my last months right away but i got a letter about 8 months later saying my benefit went up $28/month because of those extra earnings. not a huge amount but hey its something

Don't overthink this! I stressed about the EXACT same timing issue. Worked until July thinking my benefit would go up substantially. After ALL that extra work (and waiting) my benefit only increased by $13/month. If you're making really good money it might be worth it but for most people the increase is pretty small, especially if you're just talking about a few more months of work. Remember your benefit is based on your 35 highest earning years (adjusted for inflation). A few more months rarely makes a big difference unless you're replacing years of $0 or very low earnings in your history. My advice: if you're ready to retire, just DO IT. File for benefits and enjoy life!

The Social Security Admin is TERRIBLE about updating your earnings quickly!!! I retired in 2024 and my last year of earnings STILL haven't been properly counted toward my benefits calculation. I've called them multiple times and keep getting different answers about when it will be fixed. Sometimes they say automatic, sometimes they say I need to request a recalculation. SO FRUSTRATING!

Check your Social Security Statement online (my Social Security account). It shows your earnings history year by year. See if all your past years look correct first. For timing: SSA gets W-2 info from IRS, usually processes by September-October the following year. But they do ARF (Automatic Recomputation of Benefits) annually, so if 2025 earnings increase your benefit, they'll adjust automatically. You'll get retroactive adjustments too. One important thing: if you're past FRA, you can file for benefits AND keep working with no earnings limit. So you could potentially start benefits in February and still have your 2025 earnings count toward potential benefit increases later.

my brother waited till 70 to maximize his ss and then died 8 months later. dont wait too long!!!!!

Just to clarify some points from the discussion: 1. Yes, you can file for retirement benefits AND continue working once you reach FRA (which you're very close to). There's no earnings limit penalty at that point. 2. The annual recomputation (ARF) happens automatically, usually in October of the following year, so 2025 earnings would likely be reflected around October 2026. 3. For most people with steady work histories, a few additional months of work has minimal impact on benefits because it's based on 35 years of indexed earnings. 4. If you do get an increase from your 2025 work, SSA will pay retroactively to when you first began receiving benefits. Given how close you are to FRA, I'd suggest filing for benefits soon and continuing to work as long as you want/need to. You'll get the best of both worlds.

Great question! I'm in a similar situation - approaching my FRA and trying to figure out the optimal timing. From what I've researched, there are a few key things to consider: First, since you're so close to your FRA (just 2 months away), you could actually file for benefits now and continue working without the earnings test penalty. This means you'd start receiving payments immediately while still earning income. Second, regarding the earnings update timing - SSA typically processes the previous year's earnings by fall of the following year. So your 2025 earnings would likely be reflected in your benefit calculation around October 2026, with any increase being retroactive to when you first started receiving benefits. The real question is whether those extra months of work will meaningfully impact your 35-year earnings average. If you've had a consistent work history and your current salary isn't dramatically higher than your historical earnings (inflation-adjusted), the increase might be modest. One option: file for benefits when you hit FRA in May, continue working through April as planned, and let SSA automatically recalculate later if warranted. This way you're not leaving money on the table by delaying benefits for potentially minimal gain. Have you checked your Social Security Statement online to see how your current earnings compare to your historical record?

Another factor to consider is the potential for Delayed Retirement Credits (DRCs) if you wait beyond your FRA. Since your FRA is 67 years and 2 months, every month you delay filing after that point until age 70 gives you about 0.67% increase in your monthly benefit for life. However, given that you're only talking about working a few extra months (through April), you're probably better off filing right at your FRA in May as others have suggested. The DRCs would only apply to those couple months of delay, which wouldn't add much to your lifetime benefit. The key insight from this thread is that you have flexibility - you can start benefits at FRA while working, and any benefit increases from your 2025 earnings will be applied retroactively later. This removes the pressure to make a perfect timing decision upfront. Just make sure to factor in taxes too - if you're earning income AND receiving Social Security benefits, up to 85% of your SS benefits could be taxable depending on your combined income level.

I went through this exact decision last year! I was also close to my FRA and debating whether to keep working a few more months. Here's what I learned from my experience: I ended up filing right at my FRA and continued working part-time for about 6 months afterward. The peace of mind from having that monthly Social Security payment coming in was worth more to me than optimizing for every last dollar. One thing that really helped my decision was calculating my "break-even" point. I looked at how much additional benefit I might get from those extra months of earnings versus how much I'd receive by starting benefits immediately. For most people with decent work histories, the math favors starting benefits at FRA rather than delaying for just a few months. Also, don't underestimate the value of having more time and flexibility once you retire. Those extra months of freedom to spend with family, travel, or pursue hobbies can be invaluable. My suggestion: file when you hit FRA in May, work through April if you want to, and don't stress about maximizing every penny. The automatic recalculation will take care of any benefit increases later, and you'll have the security of benefits starting right away.

One thing I'd add to this excellent discussion - make sure you understand how Social Security calculates your benefit amount in the first place. They take your 35 highest-earning years (adjusted for inflation), average them out, and apply a formula. If you've been working steadily for 35+ years, those extra few months in 2025 would only help if they replace one of your lowest earning years in that 35-year period. You can actually see this breakdown in your Social Security Statement online. Look at your year-by-year earnings history - if your 2025 projected income would be higher than your lowest year shown, then yes, it could bump up your benefit slightly. But if you're already at or near your peak earning years historically, the impact will be minimal. Given that you're just 2 months from FRA, I'd echo what others have said: file for benefits in May when you reach FRA, keep working through April if you want the income, and let the automatic recalculation happen later if your 2025 earnings warrant an increase. The difference between starting benefits now versus waiting those extra couple months is probably not worth the delay in payments. Good luck with your decision!

Based on all the great advice here, it sounds like you've got a solid plan forming! I'm in a similar boat (turning 66 next year) and this thread has been incredibly helpful for my own planning. One additional resource that might be useful - the SSA has a retirement estimator tool on their website that lets you model different scenarios. You can plug in your expected 2025 earnings and see how it might affect your benefit calculation. It's not perfect, but it can give you a ballpark estimate of whether those extra months would be worth it financially. Also, since you mentioned you're close to your FRA, you might want to consider the timing of when you actually submit your application. Even though your FRA is in May, you can apply up to 4 months in advance. So if you wanted to start benefits right at your FRA, you could submit the application as early as January and specify May as your desired start date. The peace of mind factor that others mentioned really resonates with me too. Sometimes the "optimal" financial decision isn't always the optimal life decision. Sounds like you're on the right track with filing in May and working through April if you want to. Best of luck with your retirement!

This is such a thorough and helpful discussion! I'm 66 and facing a similar decision next year when I hit my FRA. Reading through everyone's experiences has been incredibly enlightening. One thing I'd add based on my research is to consider your spouse's situation too if you're married. If you're the higher earner, your Social Security benefit amount will determine the survivor benefit your spouse could receive. So maximizing your benefit (even slightly) through those extra months of work could have long-term implications for your spouse's financial security. That said, it sounds like the consensus here is pretty solid - the benefit increase from a few extra months of work is usually modest, especially if you already have a strong 35-year work history. The automatic recalculation feature really takes the pressure off having to time everything perfectly. @William Schwarz - your plan to file at FRA in May while working through April sounds very reasonable. You're getting the security of starting benefits right away while still maximizing your 2025 earnings potential. Plus, if those earnings do bump up your benefit calculation, you'll get the retroactive adjustment later. Win-win! Thanks to everyone for sharing such detailed experiences and advice. This thread should be bookmarked for anyone approaching retirement!

I'm facing a very similar decision at 66, so this thread has been incredibly valuable! One thing I'd suggest is also considering your health insurance situation. If you're currently getting employer-sponsored health insurance, make sure you have a solid plan for coverage after you retire in May. Medicare doesn't kick in until 65 (which you've already passed), but if you're still on an employer plan, you'll want to coordinate the timing of when you leave that coverage. Also, I've found it helpful to think about this decision in terms of your overall retirement income strategy. Social Security is just one piece of the puzzle along with any 401(k), pension, or other retirement savings. Sometimes starting that steady monthly SS payment provides a good foundation that makes it easier to manage withdrawals from other accounts. The automatic recomputation feature really does take a lot of the guesswork out of the timing decision. You can start benefits when you're ready and let SSA handle the earnings updates later. That removes the pressure to get the timing "perfect" from a financial optimization standpoint.

I'm 64 and planning ahead for this same decision in a couple years, so this discussion has been incredibly helpful! One aspect I haven't seen mentioned yet is the impact of inflation on your decision timeline. Social Security benefits get annual cost-of-living adjustments (COLA), but your current earned income doesn't get that same protection once you stop working. So there's value in locking in that Social Security benefit sooner rather than later, especially given the current economic uncertainty. Also, I've been tracking my earnings on the SSA website for the past few years, and I noticed they're actually pretty good about updating earnings relatively quickly - usually within 3-6 months of when employers submit their quarterly reports. So your early 2025 earnings might show up faster than the traditional "wait until after tax season" timeline that some people mention. @William Schwarz - your plan sounds very solid. Filing at FRA while continuing to work gives you the best of both worlds, and the automatic recalculation takes the guesswork out of timing. Plus, you'll have that predictable monthly income starting right away, which can make budgeting and retirement planning so much easier. Good luck with your decision!