Q: Here is our scenario. My wife will be 66 this year (her full retirement age). Her monthly Social Security benefit based on her work experience is $1,016. I won't reach my full retirement age for three years. My benefit at that point will be $2,165. My wife wants to start collecting this year, and my plan is to defer until I reach full retirement age.
Is there some way to maximize our situation by using the spousal benefits rules? My understanding is that she cannot claim spousal benefits this year because I haven't reached full retirement age. Is that right? Is it possible for me, when I reach FRA, to delay my application in order to accumulate additional credits, but to collect a spousal benefit -- one-half of her monthly amount until I reach age 70? -- SD, via email
A: You've chosen your best strategy.
Yes, at full retirement age, you can apply for a spousal benefit based on your wife's work record, without simultaneously applying for your own benefit. You can't do that when you're younger. (For information on what to do if your application is initially rejected, see my article 'Setting Social Security Straight'.)
The result: You'll get 50% of her monthly benefit until you're 70, while your own benefit earns extra credits. Then you'll switch from your spousal benefit to your own larger benefit.
You will have earned four years of 8% annual credits, boosting your benefit from $2,165 to $2,857.80. (Actually, you'll get more than $2,857.80 because of annual inflation adjustments.)
When your wife applies for Social Security this year at 66, she'll be applying for her own benefit. She can't apply for her spousal benefit at that time because you haven't yet applied for Social Security. A person who is married can't apply for a spousal benefit until his/her spouse files for Social Security.
(If you had already reached your full retirement age, you'd have a different set of options. You could apply for Social Security and then immediately suspend your application. Then she could apply for either her own benefit or her spousal benefit -- a choice available to anyone who has reached his or her full retirement age. But at 63, you're not allowed to apply for your benefit and then suspend your application.)
As things stand, when you apply for Social Security your wife will already have been receiving her own benefit for three years. At that point, she can ask to have her benefit check adjusted to take her spousal benefit into account. But the adjustment probably won't add much to the amount she gets. The reason: From what you say, her spousal benefit and her own benefit are almost the same. She'll get an amount equal to the larger of the two. You can never collect your own benefit and your spousal benefit at the same time.
Please send your questions to Lynn@LynnBrennersFamilyFinance.com. I'm sorry I can't respond personally to every email. Questions are addressed only online.
(c) Lynn Brenner, All Rights Reserved.
My wife is 68 and I am 60. When she applied for social security at age 65 she was told she had to wait for me to reach retirement age because she did not have a social security of her own (she has been a homemaker and mother).
My question is: When I reach 62 can she reapply to social security (she will be 70) and receive it under my benefits without me having to retire at 62, or do I have to go on social security early for her to get benefits at age 70? Also, what kind of benefits can I expect for her?
Posted by: Walter J. Coleman Jr. | 05/12/2010 at 10:56 AM