Dear Rusty: My husband turns 68 next year, and I will be turning 66. He plans on continuing to work and retiring at age 70 to maximize his monthly Social Security benefits. I am retiring next year due to a spinal injury. Since my monthly maximum is based on his, we are trying to figure out when mine should be activated to earn the highest benefit amount. Do I need to wait until he reaches age 70 to maximize mine, or can I activate it next year at the lesser amount and would Social Security adjust it to the higher rate when he activates his? Signed: Timing is Everything
Dear Timing: Your eventual spousal benefit from your husband’s Social Security record will be based upon his full retirement age benefit amount, not on the increased benefit he will get by waiting until he is age 70 to claim. Thus, you don’t gain anything by waiting past your full retirement age and until he claims his at 70 to start your own benefits. If you will be 66 next year, I assume your year of birth is 1953, which means your full retirement age (FRA) is 66. That means at age 66 you will get 100% of the benefit you have earned from a lifetime of working. By starting your benefits at age 66, your husband can then file a “restricted application for spousal benefits only” and collect 50% of the amount you are collecting, while allowing his own Social Security retirement benefit to continue to grow (it’s already growing, but without him getting a spousal benefit from your record).
He can do this because he was born before the Jan. 2, 1954 cutoff date after which that option was eliminated. By filing the restricted application after you start your benefits, your husband can collect a spousal benefit from you while he is still earning delayed retirement credits (DRCs) for himself, which will mean his benefit at age 70 will be 32% more than it would have been at his FRA of 66. Then, when your husband claims his own benefit at age 70, you should apply for your spousal benefit, which will be 50% of his FRA benefit amount (you get that if it is more than you are getting from your own work record). And in the intervening months between when you apply at age 66 and when he claims his own benefits at age 70, your husband will have collected about two years worth of spousal benefits from your work record.
One final word of caution: should you decide to claim your own Social Security benefit before you reach your full retirement age next year, your eventual spousal benefit will be somewhat reduced. Waiting until you reach your FRA to apply for your own benefit will ensure you get the maximum spousal benefit you are entitled to when your husband switches to his own Social Security benefit at age 70. And at that time you will need to apply for your spousal benefit; it will not start automatically.
For more information or to submit a question, visit amacfoundation.org/programs/social-security-advisory) or email email@example.com.