NewslettersSign inAPP
spainSPAINchileCHILEcolombiaCOLOMBIAusaUSAmexicoMEXICOlatin usaLATIN USAamericaAMERICA


How to receive up to six months of Social Security benefits in one lump sum

There is a mechanism available for people at full retirement age to receive a lump sum but it is detrimental in the long term.

Delaying claiming Social Security boosts monthly payments

Under certain circumstances, it is possible to receive up to six months of Social Security benefits in one lump sum. This is known as a retroactive benefit payment. Here’s how it works.

When you first apply for Social Security retirement benefits, there is a waiting period between when you become eligible for benefits and when you actually receive your first payment.

If you are approved for Social Security payments but have been waiting for more than one full month after you became eligible, you may be eligible the retroactive benefit payment. This means that you could receive a lump sum payment for up to six months of benefits.

To qualify for a retroactive benefit payment, you must meet the following criteria:

  • You must have been eligible for benefits for at least one full month before your application was approved.
  • You must not have received any benefits during the waiting period.
  • You must be at least full retirement age or older.

If you meet these criteria, you can request a retroactive benefit payment when you apply for Social Security retirement benefits.

This scenario only happens when a retiree waits to file an application for retirement benefits once they have hit full retirement age instead of filing immediately.

The appropriate form can be found here.

When is an appropriate time to claim the lump sum?

It’s important to note that while a retroactive benefit payment can provide a large lump sum of money, it also means that you will receive smaller monthly payments for the rest of your life. It’s important to consider your financial needs and goals before deciding whether to request a retroactive benefit payment.

“There are many situations where taking the benefits in a lump sum would not be advisable because you are lowering your monthly benefits for the rest of your life,” Russ Settle, founding partner with Social Security Choices in Elkton, Maryland, says. “But if you expect a relatively short life expectancy, it makes sense. Giving up the money now and gaining it later assumes that you’ll be around later to get it, which might not be the case if you don’t expect to live long.”

For example, if you take a lump sum at 67 when your full retirement age in 66 then you will receive payments for the rest of your life if you had retired at 66 and a half.