Which describes the effect of working an additional year on Social Security benefits?

Which describes the effect of working an additional year on Social Security benefits?

• A. It adds another year of earnings to the earnings record
• B. It reduces benefits
• C. It resets the full retirement age
• D. It eliminates the delayed retirement credit

Answer: (A)

Working an extra year changes your Social Security picture by updating the earnings record that the program uses to compute benefits. The benefit amount isn’t based on one year alone; it’s calculated from the 35 highest-earning years (adjusted for inflation). When you work another year, that year’s earnings are added to your record. If you have fewer than 35 years, that new year fills a missing spot and typically increases the average, boosting benefits. If you already have 35 or more years, the new year only raises your benefit if its earnings exceed the lowest year currently in your top 35; otherwise it may have little or no effect. In any case, the immediate effect described by the option is that it adds another year of earnings to the earnings record, which is the first step in potentially increasing benefits.

Working an extra year changes your Social Security picture by updating the earnings record that the program uses to compute benefits. The benefit amount isn’t based on one year alone; it’s calculated from the 35 highest-earning years (adjusted for inflation). When you work another year, that year’s earnings are added to your record. If you have fewer than 35 years, that new year fills a missing spot and typically increases the average, boosting benefits. If you already have 35 or more years, the new year only raises your benefit if its earnings exceed the lowest year currently in your top 35; otherwise it may have little or no effect. In any case, the immediate effect described by the option is that it adds another year of earnings to the earnings record, which is the first step in potentially increasing benefits.