Most of us spend a lot of time figuring out how to maximize the benefits we can receive from Social Security. After all, when we’re talking about retirement, every extra income stream and every dollar makes a difference.
So it might sound strange at first to talk about how to stop your Social Security benefits from coming in. But in some situations, there are a number of reasons why stopping your Social Security benefit is the right thing to do.
There’s a right way to do this, and a wrong way — and you need to know the difference so you can understand when it makes sense to turn off Social Security benefits, and how to do it correctly so that action doesn’t come back to bite you down the road.
Why Stop Social Security Benefits?
Sometimes, people file for their Social Security benefits and then realize they need to stop receiving this income — at least for a little while. It might be because they went back to work and earn their income that way, or feel like they made a mistake to file when they did (and feel it would have been beneficial to file later).
Whatever the reason you might face, know that you can change your mind and stop your benefits. However, there are two distinct methods you can use to stop Social Security benefits, and each of them have different rules and outcomes.
Understanding the differences between these two methods is really important.
Method 1: Suspending Social Security Benefits
Suspending Social Security benefits is the first way you can go about this. A suspension of benefits can only happen after you reach full retirement age.
This is the simplest way to stop your benefits (assuming you’re of the right age), because there’s no paperwork to fill out or lengthy process to follow. You simply call and tell the technician you want to suspend your benefit. That’s it.
This method is like hitting the pause button — and the upside of doing this is that every month you suspend your benefits, the total amount you receive increases by ⅔ of 1%. Not a lot, obviously, but again, sometimes every little bit helps when it comes to retirement income.
Method 2: Withdrawing Social Security Benefits
The second option available to you to stop Social Security benefits is choosing to withdraw those benefits. If suspending your benefits was like hitting the “Pause” button, the withdrawal option effectively hits the “Undo” button on your benefit election.
Going this route makes it like filing and receiving your benefits never happened. But the rules for this option are different than Method 1.
You can withdraw Social Security benefits anytime between ages 62 and 70 — but you must choose to do so within the first 12 months of receiving benefits. Once that 12 month window closes, you can no longer use this option.
Withdrawing benefits also means you have to repay all your benefits. This includes the benefits that you already received and any benefits that your spouse or children received. (The one exception is for a divorced spouse.) You must also pay back any Medicare premiums that were withheld and any voluntary tax withholding that came out of your benefit check.
You can only use this withdrawal method once, and keep in mind that anyone else’s benefit that would also be stopped from your withdrawal will have to provide written consent before your request is approved.
For example, a spouse who is receiving spousal benefits right now would no longer get those benefits should you withdraw your benefits. Since this would create a loss of income for them, they’ll have to agree to the withdrawal of benefits.
Should You Stop Social Security Benefits Using Either Method?
You need to be fully armed with all the information before you decide to make either of these moves. Continue to do your own research and talk to your own advisors before you make a big move like this.
If you haven’t already, subscribe to our YouTube channel for more educational content like this to help you find the answers you need for all things Social Security. And for more information on this topic, you can start with these links from the Social Security Administration: