How Can We Take Advantage Of The Social Security Spousal Benefit?

Today’s column addresses questions about taking advantage od spousal benefits using restricted applications, spousal benefits after retirement benefits, suspending retirement benefits, whether to take early widow’s benefits and years with no SSA taxed income. Larry Kotlikoff is a Professor of Economics at Boston University and the founder and president of Economic Security Planning, Inc, which markets Maximize My Social Security and MaxiFi Planner.

See more Ask Larry answers here.

Have Social Security questions of your own you’d like answered? Ask Larry about Social Security here.


How Can We Take Advantage Of The Social Security Spousal Benefit?

Hi Larry, I was born in mid December 1953 and my husband was born in mid January1954 so we both recently reached our FRAs. We have been married 40 years. We are interested in taking advantage of the spousal benefit since I was born before the cutoff for this benefit. I’m not sure which of us needs to file a restricted claim for the spousal benefit and which of us files a retirement benefit claim. Thanks, Gloria

Hi Gloria, You’re the only one of the two of you who could file a restricted application for spousal benefits only. Your husband doesn’t have that option because he was born after 1/1/1954.

However, your husband must elect to start drawing his retirement benefits in order for you to be able to file a restricted application for spousal benefits, and you couldn’t file a restricted application for spousal benefits effective with any month prior to the month you reach full retirement age (FRA). Your best filing strategy depends on many different factors, so you and your husband might want to use one of my company’s two apps — Maximize My Social Security or MaxiFi Planner — to fully explore and compare all of your various options so that you can choose the best possible strategy for claiming your benefits. Social Security calculators provided by other companies or non-profits may provide proper suggestions if they were built with extreme care. Best, Larry


Can My Wife Switch To Spousal Benefits When She Turns 65?

Hi Larry, My wife has been on Social Security disability for approximately 10 years. She is turning 65 in March. I am 68 and collecting my benefits. Can my wife switch to spousal benefits when she turns 65? Thanks, Alan

Hi Alan, Your wife couldn’t switch to drawing just spousal benefits instead of her own benefits, but she could potentially file for additional spousal benefits from your record. However, if she chooses to start drawing spousal benefits prior to the month she reaches full retirement age (FRA), her spousal rate will be reduced for age. Best, Larry


Can I Suspend My Benefits And Wait Till 70 To Start Them Again?

Hi Larry, I am 66 and started collecting my Social Security retirement benefit once I reached my FRA. I still work full time. Can I suspend my retirement benefits and wait till 70 to start receiving it again so I can increase my amount or will it not make a difference at this time? Thanks, Ted

Hi Ted, Yes, you can voluntarily suspend your retirement benefits anytime from full retirement age (FRA) until 70. If you do so, your subsequent benefit rate will be increased by 2/3rds of 1% for each month that you choose to suspend your benefits or 32% if your FRA is 66 and you suspend it for the full four years at 8% per year for delayed retirement credits (DRCs). Best, Larry


Should I File For Widow’s Benefits At 60?

Hi Larry, I’m 56 years old and working full time. My husband recently passed away. Should I apply to receive widow’s benefits at 60 or should I wait some number of years? I’m not hurting for money but don’t know the pros and cons of applying for my widow’s benefits. Are there earnings limits if I do apply for widow’s benefits? Thanks, Beth

Hi Beth, I’m sorry for your loss.

I can’t give you a definite answer, but your best strategy would likely either be to file for reduced widow’s benefits at 60 or as soon as your earnings will permit at least some benefits to be paid, then switch to your own record at age 70, or to file for reduced retirement benefits on your own record at 62 or as soon as your earnings will permit at least some benefits to be paid and then file for unreduced widow’s benefits at full retirement age (FRA). However, if your deceased spouse received reduced Social Security retirement benefits prior to his death, you would likely want to file for your widow’s benefits earlier than FRA.

Normally, you would want to start out drawing the lower benefit first and then switch to the higher record when it reaches its highest potential rate. Our software — Maximize My Social Security or MaxiFi Planner — could sort all of this out for you and help you determine your optimal filing strategy. As I noted above, as long as they were very well engineered, Social Security calculators provided by other companies or non-profits may also be able to provide proper suggestions. Best, Larry


Will I Need To Furnish Anything Special When I File For Social Security With Respect To My Zero Earnings Years?

Hi Larry, I am 67 years old and plan to defer benefits until 70. My Social Security earnings record begins in 1966 and ends in 2017 and I have 11 years with zero Social Security taxed earnings because I was working overseas. Will I need to furnish anything special when I file for Social Security with respect to my zero earning years? Thanks, Hal

Hi Hal, If you were working overseas, I assume that Social Security taxes weren’t deducted from your wages and the zeroes on your earnings record in those years are correct. If you had any earnings on which you did pay Social Security taxes and those earnings don’t show up on your record, then you would need to submit proof of the earnings (e.g. W-2 forms) to Social Security in order to get them credited to your record. Otherwise, you don’t need to do anything. Best, Larry


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