Today’s column addresses how Social Security spousal benefits are determined, whether to switch from retirement benefits to taking spousal benefits and vice versa, potential effects of early retirement benefits on survivor’s benefits and whether to switch from disability to retirement benefits. Larry Kotlikoff is the founder and president of Economic Security Planning, a company that markets Maximize My Social Security, a Social Security benefits calculator referred to in this post.
See more Ask Larry answers here.
Ask Larry about Social Security:
If I Can Qualify For Social Security Spousal Benefits, How Much Will They Be?
Hi Larry, I’m 66 and don’t have enough credits to get a Social Security retirement benefit on my own work. But can I get spousal benefits on my husband’s work record? My husband is also 66 and will work until he is 70 when he’ll file for his increased benefits. Will more work increase his benefits in addition to delaying past 66 to file? How will all this affect what my spousal benefit will be? Thanks, Sara
Hi Sara, You can’t get spousal benefits until your husband starts drawing his retirement benefits. You husband can earn delayed retirement credits for each month he doesn’t receive his retirement benefit after his full retirement age (FRA) of 66 and 70. He can also increase his Primary Insurance Amount (PIA), which is equal to his full retirement age (FRA) retirement benefit amount, if his continued income is sufficiently higher than earlier years used to calculate his PIA.
The increases to his retirement benefit due to DRCs earned by waiting past his FRA will not increase your spousal benefit, which can never be higher than 50% of his PIA. However, any increases to his PIA due to continued earnings will increase your spousal benefit. You and your husband may want to strongly consider using an expert Social Security benefits calculator as described in other answers to compare your options between filing for benefits now vs. waiting until your husband turns age 70. Best, Larry
Can My Husband File For Spousal Benefits At His FRA And Switch To His Retirement Benefits At Age 70?
Hi Larry, I’m 67 receiving my Social Security retirement benefit. My husband is 63 still working. Can my husband apply for spousal benefits at his FRA and then suspend and file for his retirement benefit when he stops working at 70? What other options are available ? Thanks, Jessie
Hi Jessie, Since your husband was born after 1/1/1954, he’ll be deemed to be filing for both his own retirement benefits and spousal benefits whenever he files for either one. And, he’ll just receive essentially the higher of the two benefit rates, which would be reduced for age if he files before full retirement age (FRA).
As far as other options, your husband could file for benefits any time between now and age 70. And, when he files you could potentially file for additional spousal benefits if 50% of his Primary Insurance Amount (PIA), which is equal to his full retirement age (FRA) retirement benefit amount, is higher than your PIA. Which filing option is best depends of your relative benefit rates as well as a number of other factors such as personal preferences. Your husband may want to strongly consider using an expert Social Security benefits calculator, such as Maximize My Social Security or other accurate and precise software, to compare his options in order to determine his optimal filing strategy. Best, Larry
If My Wife Files For Her Retirement Benefits Now Is She Still Eligible To Take Spousal Benefits Later?
Hi Larry, I am 59 and my wife is 64. Her Social Security retirement benefit is very small because she has mostly been out of the paid workforce. We will need to maximize our monthly benefit in retirement. I plan to work to 70, health permitting, in order to do maximize my benefit. If she files for her retirement benefit now, is she still eligible to take her spousal benefit when I retire? If she waits 19 months until her FRA, how does it affect her spousal benefit when I retire? Thanks, Marco
Hi Marco, If your wife files for reduced benefits on her own record now, she could still potentially file for spousal benefits when you file for your benefits. But, she’d only be eligible for spousal benefits if 50% of your Primary Insurance Amount (PIA), which is equal to your full retirement age (FRA) retirement benefit amount, is higher than her own PIA, and her own retirement benefit rate would continue to be reduced.
For example, say Beth has a PIA of $500, but starts drawing 19 months before her full retirement age (FRA) and receives a reduced rate of $447. Beth’s husband files for his benefits 10 years later, and he has a PIA of $2,000. Beth would then become eligible for an additional spousal benefit of $500, which would be calculated by subtracting her PIA from 50% of her husband’s PIA. Thus, Beth’s combined benefit rate would then be $947 (i.e. $447 + $500).
If Beth in the example above waited until FRA to file for her retirement benefits, the only difference is that she would then initially receive her unreduced rate of $500 and her combined rate after becoming eligible for spousal benefits would be $1,000. Best, Larry
If My Wife Files For Her Benefits Early Can We Be Certain That She Could Still Get My Full Rate As A Widow?
Hi Larry, I started collecting my Social Security retirement benefit at 62 because we had high school aged children which basically doubled my benefit. I am now 72 and my monthly benefit is about $2,000. My wife, who worked until we had children, will be 62 in a few months and is eligible for a monthly benefit of about $850, which would increase to about $1,100 if she waits until she is 66.5. Our intention is for her to start taking her $850 a month when she turns 62. Can we be certain that this will not preclude her from getting a widow’s benefit equal to my $2,000 retirement benefit? Thanks, Joel
Hi Joel, Yes, regardless of when your wife starts drawing her own benefits, she could switch to receiving a widow’s benefit equal to your full benefit rate if you die before her and she’s full retirement age or older when she starts drawing widow’s benefits. She would only receive the higher of the 2 rates, though, not both.
In fact, if you’ve received your benefits continuously starting at 62, then your wife would likely be due somewhat more than your benefit rate as a widow. When a deceased worker received reduced retirement benefits prior to his or her death, full widow’s benefits are paid at the higher of a) the worker’s reduced rate or b) 82.5% of the worker’s Primary Insurance Amount (PIA), which is equal to their full retirement age (FRA) retirement benefit amount. And if you’ve received your benefits continuously since 62, your reduced rate would be less than 82.5% of your PIA. Your wife may want to strongly consider using an expert Social Security benefits calculator, such as my company’s software or another very careful and comprehensive program, to compare her various filing options and determine which strategy would likely be optimal for her. Best, Larry
Should I Switch From Disability To Standard Social Security At 62?
Hi Larry, I am currently receiving disability benefits from Social Security. I am 61 and married to my 65 year old husband. He is currently drawing his Social Security retirement benefit. When I turn 62, should I change my benefits to early Social Security rather than my disability benefit? Thanks, Joyce
Hi Joyce, Almost certainly not. In theory you could switch from disability (SSDI) to retirement benefits at 62, but that would just reduce your benefit rate by roughly 30% unless your SSDI is being reduced due to the receipt of workers compensation or a public disability benefit. Furthermore, switching from SSDI to retirement benefits would have no effect on your potential eligibility for spousal benefits.
Even if you continue receiving SSDI you could potentially be eligible for additional spousal benefits at 62, but only if 50% of your husband’s Primary Insurance Amount (PIA), which is equal to his full retirement age (FRA) retirement benefit amount, is higher than your full SSDI rate. However, if you do qualify for additional spousal benefits, your spousal rate would be reduced for age if you start drawing prior to your full retirement age. An expert Social Security benefits calculator as described in other answers could help you determine what options you have so that you can determine your best course of action. Best, Larry
To learn more about your Social Security options, visit Economic Security Planning, Inc.