Social Security Spouse Benefits – Key Concepts
September 1, 2009 by Mr. GoTo
Filed under Social Security
Do you understand how Social Security retirement benefits work for (and with) your spouse? If not, you are not alone. Here is a summary of some key concepts in claiming and receiving a benefit as a husband or wife of a Social Security retiree.
Claiming a Spousal Social Security Benefit
Eligibility begins at age 62. The maximum spousal benefit is 50% of what your husband or wife receives. However, if you retire and claim the spousal benefit before your full retirement age (typically 66), the benefit will be less than 50%. This reduction in benefit depends on how many months before full retirement age you begin.
If you have worked, you can make a claim for your own benefits and can claim the greater of your own benefit or the spousal benefit. This should be carefully planned to maximize the overall benefit to the spouse. The Social Security Administration explains it this way:
If your spouse has reached full retirement age and is eligible for a spouse’s benefit and his or her own retirement benefit, he or she has a choice. Your spouse can choose to receive only the spouse’s benefit now and delay receiving retirement benefits until a later date. If retirement benefits are delayed, a higher benefit may be received at a later date based on the effect of delayed retirement credits.
In other words, it may be to your advantage to claim one benefit (e.g. the spousal benefit) earlier than your own, to take advantage of the annual increase in benefits that come from waiting until age 70.
This “claim now then claim more later” strategy can be used even if the spouse continues to work. You (the still working spouse) claim a spousal benefit. While you continue to work, your own retirement benefit continues to grow at 8 percent a year. Moreover, your additional work credits may increase the size of your benefit as well. When you reach age 70 (the maximum benefit age), you can switch from a spousal benefit to claim your own benefit, if it is greater.
Just don’t forget that if you claim any benefit before full retirement age, that benefit will be permanently reduced.
Social Security Spouse Claim and Suspend Strategy
Another technique for maximizing total Social Security retirement benefits received by a married couple is to use the “claim and suspend” strategy. This strategy can work if you can afford to wait until age 70 to claim all of your benefits.
The basic claim and suspend method involves the following steps:
1. One spouse claims his or her Social Security benefit. The other spouse signs up for the spousal benefit. The first spouse then immediately notifies Social Security that he or she wants to “suspend” his or benefit. This causes the primary benefit to stop but the spousal benefit continues.
During the time that the primary benefit is suspended, the amount of the benefit will increase by 8 percent a year, until age 70. The spouse then “unsuspends” and collects the larger benefit.
Again, you can use this strategy only if you are at full retirement age and have never collected early benefits.
Surviving Spouse Social Security Benefit
The benefit rules that apply to the surviving widow or widower of a deceased Social Security retiree are different. First, the survivor’s benefit can be as much as 100% of the benefit received by the deceased spouse. This means that if a spouse was receiving a 50% spousal benefit, that can double upon the death of the other spouse. (Not that this a good thing, but it helps a little.)
Second, the survivor’s benefit can be claimed by a spouse who is at least age 60. This is two years sooner than eligibility for a normal spousal benefit.
However, if the surviving spouse claims a survivor’s benefit before reaching full retirement age, the benefit will be decreased by as much as 28.5%, depending on age.
Final Thoughts on Social Security Spouse Benefits
I think the key takeaway from this discussion is this: Never claim your own Social Security retirement benefit without considering: (1) how it might affect your spouse after you die; and (2) how coordinating regular and spousal benefits can maximize the total Social Security payments that you receive as a married couple.
Photo credit: Travis Jon Alison
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Assume the husband and wife are both 66 (FRA).
“Let’s say the husband is entitled to $1,200 a month based on his earnings record, and his wife is entitled to $500 a month on her record.
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Question:
Why couldn’t the husband file and suspend and the wife instead file now for spousal benefits and receive 1/2 the husbands $1200 = $600. Then the huspand files again for spousal benefits resulting in 1/2 $500 = $250.
The total couples income of $250 + $600 = $850/month thru age 70.
Then the husband files for his own benefit.
Robert: Check with the SSA to be sure but my understanding is that if you file and suspend, you cannot receive a lower spousal benefit. In other words, if the husband files for his own larger benefit and then suspends, when he claims a spousal benefit from his wife, he is technically “double-dipping” which is a violation of the dual entitlement rule. The SSA says that if you are entitled to two benefits (your own or your spouse’s), you must claim the the greater of the two. When claiming and suspending, you are still “entitled” to your own higher benefit. Thus, your strategy won’t work. But I like the way you think!
Thanks for your reply above. Here’s a different scenario:
Assume the husband is 66 and wife is 70.
“Let’s say the husband is entitled to $1,200 a month based on his earnings record, and his wife is entitled to $500 a month on her record.
If the husband files and suspends does the wife receive $600 or
32% more because of her age?
Robert- My understanding is that the maximum spousal benefit is 50%. Once the spouse hits FRA, that’s it. So in your example, $600 would be the spousal benefit.
Thanks for your reply above. Here’s a different scenario:
Assume the husband is 66 and wife is 66.
“Let’s say the husband is entitled to $1,200 a month based on his earnings record, and his wife is entitled to $500 a month on her record.”
If the husband files and suspends at 67 and the wife files at 67,
does the wife receive 1/2 $1200 *1.08 = $648?
Also what is the recommded ages the husband and wife should file and/or suspend based on the initial scenario?
Robert: My understanding is that the maximum spousal benefit is 50% of the Primary Insurance Amount which is reached at full retirement age. In other words, the spousal benefit cannot be increased by delayed retirement credits.
I am age 62 female and retired. Can I get early benefits on my earned social security and then at age 66 file for spousal benefits of 50%. My husband is already full retirement age 67.
Jeanne – I don’t think that will work. Check with SSA to be sure but my understanding is that if you claim your own benefit before full retirement age, that will also permanently reduce the percentage of a later claimed spousal benefit, i.e., it will be less than 50% of your husband’s Primary Insurance Benefit.
we accept that the benefit is permently reduced, but could we not have the spouse with lower benefit suspend at full retirement age, collect the “reduced” 50% spousal until that person reaches 70 and then be able to receive the increase in value due to the suspension of the individual payments?
Thanks for your help. Another scenario: If I am 62 and retired and eligible for Soc Sec benefits, and my husband is 69 and waiting until he is 70 to collect full benefits at a rate about twice what I would receive at 70, would it make sense for me to collect any benefits before full retirement age (66)? If I start collecting at 62 will that make me ineligible for 100% of my husband’s benefits when he dies?
In another posting, Funny about money wrote that SS can be used as a kind of interest-free loan because ”You can start taking payments before you hit full retirement age and then, when you’re 66, you can turn back the amount you’ve drawn down and reset your payments at the full retirement rate.” The posting indicates that even the tax paid on those early SS benefits is returned? Would you recommend such a strategy if, for financial reasons, the extra cash is needed at 62 but not at 66 (when, for example, the house may be sold)?
I turn 62 this year. My wife is 58. She does not have enough credits for social security. If I retire at 62, is she entitled to a spousal benefit? If so, what is the percentage?
Richard: Your wife will be entitled to a spousal benefit but not until she reaches 62. It will be a reduced benefit if she claims it before full retirement age (66). The percentage can be determined from tables available at the SSA website.
Hi Richard,
Your wife is indeed entitled to a spousal benefit but not until she is at least 62. I’m not sure if it will be 50% of yours or if it is reduced. Contact Social Security for the estimated amou8nts.
Note also that she is also entitled to a surviver benefit equal to 100% of yours upon your death (but not sure if she still needs to be at least 62 to collect).
My wife and I are both 60. We will both be eligible for SS at 62. Her income is about 1/3 of mine. Let me pose this scenario:
At 62, my wife will draw her SS with me getting the spousal benefit on her account. This will result in a $500/mo shortfall over what we would have if I started drawing then. We will make up the difference by drawing an extra $500/mo from our nestegg. The lost interest will be far less than the 6%/yr gain I’ll get in SS benefits.
At 70, we’ll stop my wife’s SS and start mine, with her as “spouse”. At that time my SS will be nearly TWICE what it would have been if I started it at 62…and will remain that way for my life, and then hers as survivor. After those first 8 years, our draw from the nestegg will drop dramatically; leaving it pretty much as an emergency fund and a hedge against inflation.
This sounds too good to be true. But IS it?
Yes I believe it is too good to be true. According to my view of the situation, if you claim a spousal benefit you are telling the SSA that you have “retired” and are now claiming SS retirement benefits. The SSA will look to see if the benefit from your own earnings record is higher than the spousal benefit and if so, pay you that. You will not get the increased benefit from delaying until age 70.
Yep! Further reasearch shows you are right.
However, another plan (the “62/70 strategy”) is almost as good:
She (the lesser wage-earner) starts drawing on her account at 62. At 70, I apply for mine (about 148% of what it would be at 62…plus COLAs!) and she gets a much larger spousal benefit because I waited. If, at any point in the plan, we find we can’t make it without both benefits, I apply; and we still get a higher rate than if we’d have started out on just mine plus spouse. Not what we’d get at 70, but still more. Google “social security 62/70″ for better explanations.
My wife worked for 30 years. She died at age 57. will i ever see any of her benifit. I make more than she did and woulod receive more at age 65. I am also 57
I’m sorry for your loss.
And the answer is no. Since your own benefit is greater than any “survivor” benefit on her account, that’s what you’ll get. You don’t get both.
My husband is 66 and employed and began receiving social security benefits when he reached his full retirement age of 66. I am 65 and also employed. I am covered under a state pension plan and my social security benefit will be reduced according to the windfall provision formula. I plan to continue working and file for SS benefits when I reach 66, as they will not be reduced until I begin receiving my state pension benefit. Can I claim the 50% spousal benefit right now and still work or do I have to wait until I’m 66? (The 50% spousal rate is greater than my own benefit.)
Linda: If you claim a spousal benefit before your full retirement age, it will be less than the maximum which is 50%. The SSA site has a table where you can calculate the amount. I do not know how the windfall provision may affect that.
I am a sixty one year old male and will be sixty two in april of this yr. My wife past away three years ago. She also worked but I don’t know what her acumative ss credit is. how can I find that out? and can I file on her’s if she had enough credits and then refile on mine when I reach my retirement age at sixty six and three months
My sister, kathleen, is married and she is turning 65 in April, 2010. Her husband is 62 and will be 63 in November, 2010. He applied in Feb., 2010 for her to receive her Medicare & S.S. on his S.S. since she never worked. My sister received a letter from S.S. stating that her S.S. Ck will not begin until Sept. 2010, even though her Medicare begins April 1, 2010. Since her husband is still working and he makes too much, is that why S.S. is holding back her S.S. check until Sept. instead of April? Please advise as we are totally confused.
Thanks
I am 66 years old, full retirement age and get Social Security retirement benefit. I am not retired yet, I still working.
My wife is 62 year old, she does not have enough Social Security credits.
Can she apply for Social Security spouse benefit now or has to wait until I retired?
Bob:
If you are receiving SS retirement benefits and your spouse has reached age 62, she can apply for a spousal benefit based on your benefit. Her spousal benefit will be reduced if she applies before she reaches full retirement age.
No. you misunderstood. My wife is older than me. She is 65 in April & I am 62 yrs old. Though I applied for benefits this year, I will not be getting a check until October because of my income. But I applied in February for my spouse to receive her benefits on my S.S. because she has no credits. But I’ve been informed by S.S. that she will begin to receive her payment in September instead of April – but I don’t understand why? Please help me understand.
Thanks,
I will be 68 in September 2010 and plan on working til September 2011. My wife will be 63 in August 2010. Last week I applied and suspended my benefits at the same time my wife applied for her reduced Social Security benefits and spousal benefits. At this point is it possible for my wife to change her mind and elect to delay her spousal benefits given that I have already applied and suspended? It is my plan to retire in one year. Is she required to start receiving spousal benefits when I actively retire? Given that her income has been considerably less than mine, we are trying to determine our best course.
i have been married 18 years. i am 41 years old, been mostly A house wife. my husband is 65.. and is starting his retirement.now we are sepererated, i am curently waiting on my s.s.disabilty..but he was the so to speak bread winner..am i eligable for any assitance, or intitled to any of his retirement.benifit,s he even took me off his health insurance plan.
I retired at 62 and I’m currently 68 drawing about $1666 mth.
My wife will retire at 62 in two years. Her estimated social security is $540 per month at 62 and about $750 at 66. Drawing against my social security at the reduced amount is $580. My question is can she draw as the
spouse amount ($580) and then at age 66 draw on her full retirement of $750?