Can I stop my Social Security & restart later? A decision guide

Have you begun to second-guess your decision to start taking Social Security benefits? Maybe you've changed your mind about continuing to work, or you've simply realized you can do without your benefits for a bit longer.

You might be wondering if you can stop Social Security and restart later. The short answer is yes, but there are some caveats.

Let's review the two options offered by the Social Security Administration if you're reconsidering your timeline for taking Social Security benefits as well as when it may make sense and how it might affect Medicare.

You can stop your Social Security if you've started taking benefits but it's been less than 12 months since you became eligible. However, you will have to pay back all benefits received up to that point. This restart is referred to as a full withdrawal.

If you have reached full retirement age, you also can suspend your benefits and earn delayed retirement credits for the months you receive no benefits. Your payments automatically will restart at age 70, or you can restart them yourself by requesting an end to your suspension.

A variety of circumstances might prompt you to rethink taking Social Security benefits. For instance:

• You retired in a bad economic climate, but now the economy is rebounding. You want to work again to avoid running out of money in retirement.
• Your employer may have offered you early retirement incentives, but you realize you'd actually like to continue working, even if it's for a different employer.
• You may have received a financial windfall and you no longer need your Social Security benefits to live comfortably.
• You may have realized you can manage your expenses without a Social Security check each month and would rather have a larger payment later on.

You can suspend Social Security benefits as many times as you like, provided you are within the period between full retirement age and age 70.

When a suspension is requested, it goes into effect at the beginning of the month after you make the request. Suspending benefits multiple times doesn't incur a penalty, but it does mean a lot of paperwork for you to stop Social Security and then restart it over and over.

If you want to stop your Social Security benefits and restart later, you have two options: withdrawing your benefits or suspending your benefits.

Withdrawal of benefits is available only in the first 12 months after you become eligible for Social Security benefits. That means this option is available only before you've reached full retirement age. It is a one-time option; you cannot do it again later.

You'll need to formally withdraw your application, and anyone else who receives benefits through you also will have to consent in writing to the withdrawal. In addition, you'll have to pay back the full amount you and any others been paid on your work record. Think of this process as a Social Security do-over.

Calculate how much you've received in benefits so far, including any benefits paid to your children or spouse and withholdings for Medicare premiums, to get a sense of what you will owe.

Withdrawing your benefits can be helpful if a new source of income or work emerges soon after your retirement. The next time you apply, you'll be older and have a correspondingly higher monthly payment, which can help you get the most out of Social Security.

For instance, let's say for a 62-year-old who was born after 1960, the retirement benefit would be 30% less for retiring at 62 compared with the full retirement age of 67. And if they waited until 70, they'd receive 124% of their full retirement age benefit. The difference between 70% and 124% of your benefit can amount to hundreds of dollars a month. Choosing a Social Security do-over can be a wise financial choice if you can support yourself without Social Security until an older age.

If you choose to withdraw benefits and later change your mind, you have only 60 days to cancel the withdrawal request. Failing to cancel in time means you'll have to reapply for benefits. The process could take a while, and you could miss some payments.

Suspending your Social Security benefits is only possible if you've reached full retirement age. When you request a suspension, you'll stop receiving monthly payments until you reinstate them.

Unlike withdrawal, you don't have to pay back any prior benefits, and you can suspend benefits even if you have been retired for several years. It's also a fairly simple process of requesting the suspension in writing, on the phone or in person with the Social Security Administration.

Generally, people who suspend their Social Security benefits have enough savings or income to get by without a Social Security payment each month. The upside of this approach is that each suspended benefit month earns you delayed retirement credits that will increase your benefits when you eventually reinstate them. If you don't reinstate them yourself, they automatically will be reinstated the month you turn 70.

Unlike a full withdrawal, if you suspend your benefits, your family members won't have to pay back benefits. But they also will stop receiving benefits until you reinstate them. An exception is for divorced spouses, who can continue to receive payments even if you've suspended benefits.

When you decide it's time to restart your Social Security benefits, you can do so over the phone or in person. Your benefits will go into effect again the following month, so try to plan for it at least a month in advance.

Social Security can suspend your benefits due to issues such as incorrect information in your application or failing to disclose a source of income.

If you end up with your Social Security benefits suspended, you will need to follow the process outlined in the notifications sent to you by the Social Security Administration at the time of your suspension. You'll also need to have your eligibility verified to have your benefits reinstated, especially in cases of identity theft that led to fraud. To learn more, visit the Social Security Administration website.

Your eligibility for Medicare usually isn't affected by withdrawing or suspending your Social Security benefits. However, premiums for Medicare are withheld from your monthly Social Security check. It's important to calculate how much your premiums will be after you choose a Social Security do-over because any premiums will need to be paid out of pocket instead of from your Social Security benefit.

If you're withdrawing benefits because you're going back to work, you'll want to evaluate your employer-provided health care options. Look at how comprehensive their plans are and how much each plan would cost you per month. Then weigh those options against any benefits and premiums you might have through Medicare. It makes sense to choose whichever option is the best fit for your unique needs.