I'm collecting Social Security disability. I'm 63 years old. When I turn 66, my full retirement age, can I choose to defer taking my retirement benefit until I’m 70 to maximize my Social Security payments? Or must I take my full retirement-age benefit at 66?
Collecting a disability benefit doesn’t prohibit you from postponing your retirement benefit until you’re 70. And you’re right that a four-year delay will substantially increase that benefit. But your disability benefit checks will stop when you turn 66 — so you’ll be without Social Security income as long as you postpone your retirement benefit.
Your question rarely comes up, says Social Security spokeswoman Linda Lauria, because most people who receive disability benefits need that money to cover their living expenses.
When you collect a Social Security disability benefit, regardless of your age, the amount you receive is equal to the retirement benefit you’d get if you applied for it at your full retirement age — your Primary Insurance Amount, or PIA.
When you reach your full retirement age, your disability benefit is converted to a retirement benefit. The amount doesn't change. You’re still collecting your PIA. All that changes is that the check is now paid by Social Security's Retirement and Survivor Trust Fund instead of by Social Security's Disability Trust Fund.
But you have the option to ask the Social Security Administration, in writing or over the telephone, to delay paying your retirement benefit. If you do that, your PIA will grow an extra 8 percent a year (plus any annual cost-of-living increase) for up to four years of delay.
THE BOTTOM LINE
On reaching full retirement age, people who collect Social Security disability benefits can postpone taking their Social Security retirement benefits in order to collect a bigger amount.