I am turning 70 in a couple of months and have applied for benefits to start when I reach 70. I have two examples below and I would like to know which example is correct.
To make the example simple I will be using numbers which do not reflect the actual amounts.
PIA = 2500 at full retirement age of 66 in 2019
DRC = 200
CPI 1 for 2020 = 1%
CPI 2 for 2021 = 1%
The calculation for starting SS at 67 in 2020 would be (PIA*CPI 1) + PIA +DRC.
The next example is where I am not sure how starting SS at 68 is calculated.
(((PIA*CPI 1) + PIA)*CPI 2)+(PIA*CPI 1) + PIA) + 2*DRC
or is it
(((PIA*CPI 1) + PIA +DRC) * CPI 2) + (PIA*CPI 1) + PIA +DRC) + 1*DRC.
I guess what I am asking is if the DRC credits from the prior year are included when calculating the base amount for the next year or if CPI is only calculated on the prior year PIA amount with no CPI amount added for the prior year unclaimed DRC.
To make the example simple I will be using numbers which do not reflect the actual amounts.
PIA = 2500 at full retirement age of 66 in 2019
DRC = 200
CPI 1 for 2020 = 1%
CPI 2 for 2021 = 1%
The calculation for starting SS at 67 in 2020 would be (PIA*CPI 1) + PIA +DRC.
The next example is where I am not sure how starting SS at 68 is calculated.
(((PIA*CPI 1) + PIA)*CPI 2)+(PIA*CPI 1) + PIA) + 2*DRC
or is it
(((PIA*CPI 1) + PIA +DRC) * CPI 2) + (PIA*CPI 1) + PIA +DRC) + 1*DRC.
I guess what I am asking is if the DRC credits from the prior year are included when calculating the base amount for the next year or if CPI is only calculated on the prior year PIA amount with no CPI amount added for the prior year unclaimed DRC.