While many retirees know that waiting until age 70 can maximize their own retirement check, applying that same logic to Spousal Benefits is a costly mistake. If you are eligible for a spousal claim, waiting too long could mean losing three years of benefits for no gain.
- Why Age 70 doesn’t work A worker’s personal retirement benefit increases by roughly 8% per year for every year they delay filing past their Full Retirement Age (FRA)> However spousal benefits stop increasing once you hit your own FRA. If your FRA is 67 and you wait until 70 to claim a spousal benefit your monthly heck will be the exact same as it would be at 67. So instead of increasing the monthly benefit you miss out on 36 months of payments.
- The 50% Rule A spousal benefit is capped at 50% of the worker’s Primary Insurance Amount (their benefit at full retirement age). Even if the worker waits until 70 to get a bigger check for themselves, the spouse’s portion is calculated based on the worker’s FRA amount.
- Worker has to file unless… Generally you cannot collect a spousal benefit until the worker has filed for their own retirement or disability benefits. However there is a major exception for divorced spouses.
- The Divorced Spouse exception If you are divorced you can claim on an ex-spouse’s record even if they haven’t filed for Social Security yet. To qualify four things must be true: A. Length of Marriage: Married at least 10 years B. Current status: Currently unmarried C. Age requirement: Your ex-spouse is at least 62 years old. D. 2-Year Rule. If your ex hasn’t filed yet, the divorce must be at least 2 years old.
- No impact on the Ex-Spouse A. It has zero impact on the worker’s benefit. B. It does not affect the benefits of the worker’s current spouse. C. Social Security does not even notify an ex-spouse that you have filed on their record. If you were born in 1959 your FRA is 66 and 10 months. If you were born in 1960 or later your FRA is 67. If you are filing for spousal benefits only it never pays to wait later than your FRA.
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This is a great description of the rules involved with figuring social security benefits when coordinating with a spouse.
I know it has been mentioned before, but I think the Open Social Security calculator is worth mentioning here again in helping to strategize when to claim benefits.
James, this well written piece provided another HD “knowledge nugget” for me. I somehow missed the “50% Rule” while researching the Social Security (S.S.) landscape for my spouse/family information document in the event of my demise or becoming incapable of navigating all this. While it would only benefit us for a short time (assuming I make it to 70 when I plan to start SS); it is very nice to have the information. My long standing general pessimism and indifference toward S.S.does not diminish my desire to understand the details. Thank You
Great article, James. As Kristine comments, the best Social Security claiming strategy it not as easy as it appears, but can be easy to foul-up.
Excellent article and information. 15 years ago when I was trying to maximize Social Security I had to do a lot of reading and asking questions of friends to come to the best conclusion for our situation. I even called SS to get help, and they did answer my questions correctly. We took my wife’s SS at 65 and mine at 70, and did well. The about is excellent information for those nearing 65. Wish you all the best.
As a federal retiree who was effected by the WEP for years I can wholeheartedly agree — Do not expect correct answers from the SSA about any of this.
Thanks for the article! A follow-up question:
If my wife (who will be 65 in a few months from now) waits until HER FRA (of age 67), will her separate spousal benefit then be HIGHER than it otherwise would be if she instead claims her SS now – a few years earlier than her FRA?
(I assume the answer to this question is Yes, notwithstanding your advice in this article for her not to wait PAST age 67 to do so!)
I plan to wait until age 70 (~ 4 years from now) specifically to maximize her survivor benefit, assuming she will survive me.
Thank you!
Yes. She should wait to 67 so gets 50% of your FRA when you file at 70. Im assuming her spousal will be greater than her own benefit.
Thank you for this article.
Claiming SS benefits seems to be a complicated (and personal) decision.
You are welcome Kristine. Seeing Michael’s query below shows that the rules can be true one day and change later and that Social Security might not follow-up unless prompted.