Question: Question: I have worked all my life and made big bucks. I recently lost my job and am almost 61 years old. My husband is already on Social Security but I will get more than he does. I am worried about how much I will lose if I cannot get a job until I am age 66? They will not calculate going forward — just what it says now. I think it will decrease but is there a percentage?
Answer: You won’t lose benefits if you don’t work and contribute more to the Social Security system. What you will lose is the potential ability to raise your annual and, thus, you lifetime benefits based on Social Security’s Re-computation of Benefits. This provision raises your benefits if your earnings in the past year exceeded the lowest of your 35 past highest covered earnings after those earnings prior to age 60 have been indexed upward due to economy-wide real wage growth.
As I’ve written before, if you earn above the covered earnings ceiling, you will definitely replace the lowest of your past highest 35 years of covered earnings with your current earnings. So if you are, as you say, a high earner, you should consider how much more in benefits you’ll receive from working. There is inexpensive commercial software that can make these calculations. Apart from working and earning more, you should opt to take just your spousal benefit at full retirement age and your own retirement benefit at age 70. This will maximize your lifetime benefits.
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