Are Social Security Benefits Changing In 2021?

No rules are changing in 2021. There are different factors being applied for folks who reach FRA in 2021 and thereafter, but the rules have been in place since 1983.

The Rules

Here’s how the rules apply – for everyone: For all birth years after 1943, the Delayed Retirement Credit is 2/3% per month, which works out to 8% per full year of delay. The reduction calculation for starting benefits before your FRA is also the same for all – 20% (5/9% per month) for the three full years (36 months) closest to your FRA, and 5% per year (5/12% per month) for any months more than 36 before your FRA.

First, a quick definition: PIA – Primary Insurance Amount – This is the unreduced (and not increased) benefit that you will receive if you file at your Full Retirement Age.

Let’s look at each year of birth in order. Here are the factors used to calculate your benefits:

Birth year 1943-1954
– FRA is age 66
– minimum benefit is 75% of your PIA (48 months of reduction)
– maximum benefit is 132% of your PIA (48 months of delay increase)

Birth year 1955
– FRA is age 66 years, 2 months
– minimum benefit is 74.17% of PIA (50 months of reduction)
– maximum benefit is 130.67% of PIA (46 months of delay increase)

Birth year 1956
– FRA is age 66 & 4 months
– minimum benefit is 73.33% of PIA (52 months of reduction)
– maximum benefit is 129.33% of PIA (44 months of delay increase)

Birth year 1957
– FRA is age 66 & 6 months
– minimum benefit is 72.5% of PIA (54 months of reduction)
– maximum benefit is 128% of PIA (42 months of delay increase)

Birth year 1958
– FRA is age 66 & 8 months
– minimum benefit is 71.67% of PIA (56 months of reduction)
– maximum benefit is 126.67% of PIA (40 months of delay increase)

Birth year 1959
– FRA is age 66 & 10 months
– minimum benefit is 70.83% of PIA (58 months of reduction)
– maximum benefit is 125.33% of PIA (38 months of delay increase)

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