Should I Delay My Railroad Retirement to Get an 8 percent Increase?

When Do the 8% Delayed Retirement Credits Begin?

Welcome to another edition of the Highball Advisors Railroad Retirement Mailbag! I'm John McNamara with Highball Advisors, and today we're answering a great question from George in Georgia.

George asks:

“I’m 55 years old with 33 years of railroad service and a high earner. My question is: Do I start gaining 8% per year in delayed retirement credits once I hit 30 years of service? Or does the 8% start after reaching the 30-and-60 milestone?”

First off—congratulations, George!

Reaching 30 years of service in the railroad industry is a major accomplishment. You’ve earned your place in the 30/60 club, which opens the door to full Tier 2 benefits at age 60, even if Social Security rules haven’t kicked in yet.

But when it comes to Tier 1—the part of your Railroad Retirement that mirrors Social Security—the rules are a bit different.

Understanding Delayed Retirement Credits (The 8% Rule)

The 8% increase per year you’re referring to is tied to delayed retirement credits under Social Security rules, which apply to Tier 1 of your Railroad Retirement benefit.

• For those born in 1960 or later, full retirement age (FRA) under Social Security is 67, not 60.
• While railroaders with 30 years of service are eligible to start collecting their annuity as early as age 60 without a Tier 2 reduction, the Tier 1 portion still follows Social Security’s rules.
• That means the 8% per year increase doesn’t start accumulating until after your full retirement age (67) if you choose to delay collecting benefits.

So to directly answer your question:

❌ No, you don't start earning the 8% increase right after hitting 30 years of service. ✅ You begin earning delayed retirement credits on your Tier 1 starting at age 67, if you haven’t filed for benefits yet.

Should You Delay Your Railroad Retirement?

It’s a great question and one that depends on your personal situation—especially your income needs, health, family history, and other retirement assets.

I actually cover this in detail in my video: 🎥 Should I Delay My Railroad Retirement Until 70? https://youtu.be/Ao2_o7vdENw That video walks through the pros and cons of waiting to collect your benefits, and whether the increase in Tier 1 is worth the delay in payments.

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Disclaimer: This article is provided for general information and illustration purposes only. Nothing contained in the material constitutes tax advice, a recommendation for purchase or sale of any security, or investment advisory services. Highball Advisors encourages you to consult a financial planner, accountant, and/or legal counsel for advice specific to your situation. Reproduction of this material is prohibited without written permission from Highball Advisors, and all rights are reserved from Highball Advisors, and all rights are reserved.