Are you one of the many who have retired early? Do you regret not waiting until later so you could get a larger check every month? Well, you may be in luck. There is a little-known process you can go through to get a larger Social Security benefit check every month. It’s just as if you retired today, but there are catches and it may not be for everyone.

Some call it the Social Security do over. Others have called it the Social Security double dip. Whatever you call it, it gives retirees a second chance at a larger monthly payout. In addition, it’s legal.

Let’s go over a scenario where someone would think about doing this. Let’s say you retire at an earlier age. Because you are retiring early and choosing to take your benefits early, you do not get as much each month as you would if you had waited until you were allowed to receive your full benefit. This is because you are projected to receive payouts for a longer period of time, thus the reduced amount. Now let’s say you want a bigger check in the mail each month. One way to do this is to pay back the money you’ve already received from social security, without interest, and reapply for social security at your current age. You’ll then receive the larger amount check as if you just retired.

Here’s an example taken from a Kiplinger article dealing with this subject.

If, for example, you received $1,200 a month starting at age 62, plus annual cost-of-living adjustments through age 70, you would have to repay about $130,000. That’s a lot of money, but for some people it’s worth the price to get an additional $900 a month in retirement. By comparison, it would cost a 70-year-old man about $190,000 to buy an immediate annuity that would provide $900 a month initially, plus annual inflation adjustments and a 100% survivor benefit. That’s 46% more expensive than “buying” a lifetime annuity from Social Security.

The Upside

• You get a bigger paycheck every month and it will also increase with inflation.
• The money you pay back does not include any interest.

The Downside

• You have to come up with a large amount of money all at once to pay Social Security back.
• You may not live to recoup your money.
• You may be without any Social Security payment for some time while the Social Security office processes your request.

If this still sounds good to you, all you have to do is fill out form 521 at your local Social Security office. This is a request to withdraw your application for benefits. This can take a few weeks to process. Then you will receive a letter asking you for the total amount of benefits you have received. Once you pay this back, you can reapply for your new, higher payments based on your current age.

Image courtesy of Kurt Wagner